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Market Bottom Trap Behavior
Bottom trap, is when the main force creates a "false break" at low levels to induce retail panic and sell-offs, while quietly accumulating positions. It is the "last dip" before a reversal.
I. Core Characteristics
1. Volume shrinks during the break, with no sustained selling pressure during decline; after stabilization, volume increases during rebound, quickly recapturing support.
2. No gradual decline after the break; focus on whether the 72,000 support level stabilizes.
3. Price hits new lows but indicators show bullish divergence; key support is only briefly breached before quickly recovering.
4. Uses negative news to create panic, with no substantial deterioration in fundamentals; mainly driven by sentiment and technical suppression.
II. Common Tactics
Violent Breakout: Forcefully breaking support, then rebounding with reduced volume to recover lost ground.
Stepped-down Drop: Segmental sell-offs + sideways consolidation, repeatedly trapping bottom-fishers to force them to sell.
Limit-down Trap: Locking in a limit-down at low levels to attract accumulation, then quickly opening the limit and rebounding.
Sideways Bottoming: Narrow-range oscillation to shake out weak hands, followed by a slight breach and subsequent rally.
III. Response Strategies
1. Do not blindly cut losses or follow the decline during a low break; first observe volume and whether support is recaptured.
3. Increase positions when volume recovers key support; hold heavily if the price breaks through the sideways range.