An inside bar fakes a breakout one way, fails to follow through, then breaks back out the other side. A trap that hooks breakout traders. You take the side it breaks back into.
The Hikkake is a failed-breakout trap that starts from an inside bar.
An inside bar is a small candle that sits entirely within the range of the candle before it. The prior candle's high and low contain the next one.
The price first breaks the inside bar's range in one direction, making it look like a breakout. But the break does not follow through. Price quickly stalls and then breaks back out the opposite side of the range. Traders who jumped on the first break are left stranded in the wrong direction.
You take the side it breaks back into. That is the Hikkake setup.
How to Read
BINANCE:BTCUSDT
The name "Hikkake" describes the move itself: the first break sets the trap and hooks the followers. It corresponds to what Japanese candlestick analysis calls a "damashi," a deception.
The heart of the pattern is a two-stage move built on the inside bar's range. The first break is bait; the second, opposite break is the real one. The stops of the side that took the bait fuel the genuine move.
How to Read
BINANCE:BTCUSDT
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