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Best False Breakout Rules

The document outlines various types of false breakouts using five indicators: Bollinger Bands, Stochastic RSI, Volume, Volume Spike, and VWAP, specifically for 15-minute sniper entries. It details different false breakout types, their descriptions, and confirmation tools, emphasizing the importance of recognizing market traps and exhaustion signals. Additionally, it provides examples of bearish and bullish false breakouts, along with key conditions and a final checklist for confirming false breakouts.

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0% found this document useful (0 votes)
91 views6 pages

Best False Breakout Rules

The document outlines various types of false breakouts using five indicators: Bollinger Bands, Stochastic RSI, Volume, Volume Spike, and VWAP, specifically for 15-minute sniper entries. It details different false breakout types, their descriptions, and confirmation tools, emphasizing the importance of recognizing market traps and exhaustion signals. Additionally, it provides examples of bearish and bullish false breakouts, along with key conditions and a final checklist for confirming false breakouts.

Uploaded by

osmanyaqobi4
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOC, PDF, TXT or read online on Scribd
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complete list of False Breakout Types using your five indicators — Bollinger Bands, Stochastic RSI,

Volume, Volume Spike, and VWAP — specifically designed for 15-Minute timeframe sniper entries:

🔻 FALSE BREAKOUT LISTS

All fakeouts reveal market traps or exhaustion — they’re powerful reversal or fade signals when
confirmed properly.

🔹 1. Bollinger Bands – False Breakouts

False Breakout Type Description Confirmation Tools

1- Band Overshoot Reversal Price pushes outside upper/lower band briefly, then sharply reverses
inside.

2- Low Volume + Stoch RSI divergence + VWAP rejection.

3- Band Spike Trap Sudden spike outside the band without follow-through.

4- One candle close only outside band + Volume Spike + Bearish/Bullish Engulfing inside band.

5- Band Fake Squeeze Breakout Price breaks out from a squeeze, but fails to continue.

6- Weak volume + failure to hold VWAP + Stoch RSI cross opposite direction.

7- Double Band Fakeout Price breaks band both sides within short time (whipsaw).

8- Low conviction move + Volume oscillating + Stoch RSI stays midrange.

🔹 2. Stochastic RSI – False Breakouts

False Breakout Type Description Confirmation Tools

1- Overbought/Oversold Trap Stoch RSI crosses 80/20 levels but price fails to extend.

2 Volume remains weak + VWAP acts as resistance/support.

3- Momentum Fakeout Stoch RSI crosses up/down fast, but price doesn’t follow.

4- Price stalls at VWAP or inside Bollinger Bands + Volume divergence.

5- Stoch RSI Divergence Price makes new high/low but Stoch RSI shows opposite momentum.

6- Ideal for catching failed breakouts at key zones.

7- False Mid-Level Cross Stoch RSI crosses 50 but reverses immediately.


8- Often aligns with rejection at VWAP + weak follow-through candles.

🔹 3. Volume – False Breakouts

False Breakout Type Description Confirmation Tools

1- Breakout on Low Volume Price breaks support/resistance but with no real volume.

2- Lack of follow-through + Stoch RSI flattens + VWAP rejection.

3- Volume Decreasing During Breakout Price breaks a level, but volume fades.

4- Indicates trap. Confirm with Bollinger Band pullback.

5- Volume Surge Into Resistance High volume into strong resistance — but no breakout sustain.

6- Big wick candle + Stoch RSI divergence + return below VWAP.

7- Volume After-the-Fact Spike Volume spikes after the move finishes.

Usually stop-hunt behavior.

Watch for full-body reversal candle.

🔹 4. Volume Spike – False Breakouts

False Breakout Type Description Confirmation Tools

1- Exhaustion Spike Fakeout Massive spike at key level, then price rejects instantly.

2- Long wick candle + Stoch RSI flips + VWAP fails to hold.

3- Breakout Spike Without Structure Volume spike but price lacks structure (no HH/HL). Usually
a trap.

4- Bollinger Band re-entry confirms reversal.

No Follow-Through After Spike Candle closes strong, volume high — but next candle stalls.
Indicates buyers/sellers trapped. Ideal for fade entries.

5- Spike + Divergence Volume spike, price breakout — but Stoch RSI or Volume diverges. A+ trap
signal if VWAP is against breakout.

🔹 5. VWAP – False Breakouts


False Breakout Type Description Confirmation Tools

1- VWAP Fake Break Price breaks above/below VWAP briefly then returns inside.

2- Volume weak or spike-only + Band pullback + Stoch RSI opposite cross.

3- VWAP Whipsaw Price dances above and below VWAP multiple times — no clean direction.

4- Volume inconsistent + Stoch RSI mid-level chop + Band stays tight.

5- VWAP Trap Reversal Price breaks VWAP, retests, then fails completely.

6- Quick rejection + Volume fades + Engulfing Candle or M/W pattern forms.

7- VWAP Breakout With Divergence VWAP breaks but Stoch RSI or Volume diverges.

Excellent fakeout detection. Watch for price closing back below VWAP.

✅ Most Reliable False Breakout Setups (Sniper Traps)

Combo Signal Name Entry Trigger

1- Bollinger Overshoot + Volume Spike + VWAP Rejection Band Trap Reversal Enter as price
re-enters band with wick candle.

2- VWAP Break + Low Volume + Stoch RSI Cross Opposite VWAP Fake Breakout Sell/buy fade
after price returns below/above VWAP.

3- Volume Spike + No Follow-Through + Divergence Exhaustion TrapWait for engulfing or reversal


pattern after spike.

4- Squeeze Breakout + No Volume + RSI Flatten Fake Squeeze Exit Ideal fade setup — very high
R/R.

Best False Breakout Setup, fully integrated with VWAP, Volume, Bollinger Bands, Stochastic RSI,
Candlestick Patterns, and Support/Resistance Zones, specifically designed for 15-Minute Sniper Trades:

Best False Breakout Setup

(Trap move beyond a key level that reverses rapidly — punishing late breakout traders)
Timeframe: 15-Min Entry | Alignment: 1H + Daily

What is a False Breakout?

A False Breakout occurs when price temporarily moves above resistance or below support but quickly
fails and reverses back — trapping breakout traders and creating ideal sniper entries in the opposite
direction.

False Breakout Confirmation Using 6 Tools:

Tool Confirmation of False Breakout

1- In VWAP, Price breaks VWAP then fails to hold — reverses under/above it.

2- In Volume, Breakout happens with low volume, or volume spike + reversal (stop hunt).

3 - In Bollinger Bands, Price closes outside the band, then reverses back inside.

4- In Stochastic, RSI Shows divergence or reverses from extreme zones (OB/OS).

5- In Candlestick Patterns, Wick rejection, Pin Bars, Doji, Engulfing candles near key zones.

6- In Support/Resistance Fake break of major S/R without retest or fails retest quickly.

1- Bearish False Breakout Example (Bull Trap)

False breakout above resistance → reversal down

Setup:

Price breaks 15M resistance or HTF level.

Volume spike, but no follow-through (traps breakout buyers).

Upper BB pierce + quick rejection.


Stochastic RSI overbought or shows bearish divergence.

Forms Shooting Star, Bearish Engulfing, or Gravestone Doji.

Reverses below VWAP.

Entry:

Enter short after rejection candle closes below VWAP.

SL: Above breakout wick.

TP: Next support / BB midline / VWAP mean.

2- Bullish False Breakout Example (Bear Trap)

False breakdown below support → reversal up

Setup:

Price breaks below 15M support or 1H demand zone.

Volume is light or traps sellers with spike and reversal.

Lower BB pierce, then closes back inside.

Stochastic RSI oversold or divergence forms.

Candlestick: Hammer, Bullish Engulfing, or Dragonfly Doji.

Reclaims VWAP from below.

Entry:

Enter long on bullish close above VWAP with candle confirmation.

SL: Below fakeout low.

TP: Next resistance / upper BB / VWAP deviation.

3- Key Trap Conditions That Confirm False Breakout


Signal Meaning

1- Wick above resistance + red candle close Bull trap confirmed

2- Wick below support + green candle close Bear trap confirmed

3- Breakout with no volume support Weak move, fakeout likely

4- Candle pierces BB outer band then reverses Volatility trap

5- Price breaks level, fails retest Failed breakout

6- RSI/Stoch RSI divergence + trap candle Hidden reversal forming

4- Final Confluence Checklist for False Breakouts (Sniper Entry)

1- Price broke & reversed key Support/Resistance

2- Trap Candle with rejection wick

3 Volume Divergence or Spike Reversal

4 VWAP Rejection or Snap-Back

5- BB breach + close back inside bands

6- Stochastic RSI Divergence or OB/OS Cross

7- Timeframe Alignment: 15M candle confirms HTF (1H or Daily Zone)

8- No strong retest after breakout = weak move = trap

Pro Tips:

🔹 Look for fast snap-back moves after breakout.

🔹 Best during high-impact news, London open, or NY session.

🔹 Only trade if VWAP, Candles, and Volume agree — otherwise skip.

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