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Inducement Trap

The Inducement Trap occurs when the market rejects a point of interest, creating liquidity that it later seeks to eliminate by pulling back. Traders often fall into this trap by entering positions prematurely due to fear of missing out, leading to losses as the market pulls back to hit their stop losses. The chapter emphasizes the importance of patience and emotional control in trading to avoid succumbing to FOMO.

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263 views3 pages

Inducement Trap

The Inducement Trap occurs when the market rejects a point of interest, creating liquidity that it later seeks to eliminate by pulling back. Traders often fall into this trap by entering positions prematurely due to fear of missing out, leading to losses as the market pulls back to hit their stop losses. The chapter emphasizes the importance of patience and emotional control in trading to avoid succumbing to FOMO.

Uploaded by

AYEHAN1
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF, TXT or read online on Scribd
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SMART MONEY CONCEPT

SIMPLIFIED
By:Goitse-Modimo Odirile Mathibe

Chapter: INDUCEMENT Trap

What Is INDUCEMENT Trap?

•Inducement Trap Occurs When Market Rejects Next To Your Point


Of Interest (POI) Leaving A Low Or High Depending On A Trend
You’re Introduced To , That Has Liquidity That The Market Needs To
Sweep.

•That Low Or High The Market Leaves It Acts As A Liquidity, What


Happened Is That Market Will Simply Pullback /Retrace Again And
Eliminate That Low Or High And Grap Its Liquidity And Therefore
Price Will Start Pushing With The Overall Direction.
INDUCEMENT Trap On An Uptrend.

•The Reason Why We Call It A Trap It’s Because Most Traders Take
Their Entries On That Level Thinking That Market Will Leave Them
Behind.

•Not Understanding That Market Maker Was Simply Trapping Them,


So After They Took Their Entries Price Will Not Break A High If We
Are On A Uptrend And It Will Not A Break A Low If We Are On A
Bearish Trend. Instead What Will Happen Is That Market Will Pull
Back To Eliminate Them And Tap Into Our POI.

•In That Case Most Traders Who Are Suffering From FOMO (Fear Of
Missing Out) ,After They Take Their Pre-Mature Entries They Gonna
Be In Profits For A Short Period Of Time, Then They’ll Hold Their
Trades Thinking That Market Is Going To Hit Their Targets. But The
Market Maker Will Pullback To Hit Their Stop Losses And Tap Their
POI Which Is Demand On An Uptrend And Supply On A
Downtrend , After Hitting Their Stop Loss Price Will Continue Going
With The Overall Direction.

INDUCEMENT Trap On A Downtrend.

Moral Of This Chapter:

•Moral Of This Chapter Is That People Should Practise Patience And Try By All Means To Work
On Their Emotions And Psychology, So That They Won’t Suffer From FOMO . I Always Tell My
Colleagues That Market Will Pay You The Most Money When You’re Disciplined And You Should
Always Humble Yourself If Not Market Will Do It For You As Always :)

Written By Founder Of Lamron Projects:

GOITSE-MODIMO ODIRILE MATHIBE

Signature:

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