Context: This set-up occurs on $BTC and $ETH almost 3-4 times a week and has a very high hit rate. This is my attempt to simplify it
Steps:
- Wait for price to reach an important support/resistance level (we'll use support and a long example)
- We either hold above support or we sweep that Higher Timeframe support level. Then we check order flow at the lows (you can use @VeloData or @ExochartsC for this)
- Look for Negative Delta + Increase in Open Interest at the lows of local range. Rules: OI increase must be higher than usual + must not decrease immediately
- Long entry AFTER price moves above local high (High of the candle marked here)
- Stop loss below local low. Target the local high OR wait for a candle where a lot of Green Delta + Red OI = Shorts that entered at the lows are finally exiting/puking
- Repeat same at a resistance level and trapped longs