One of my favourite price action trading patterns is the fakey pattern. There are many reasons why I like this pattern but perhaps the most important is the meaning behind it and its ability to be a reliable indicator of potential near-term and sometimes long-term market direction.

Live Trade - 'Fakey' Price Action Setup on GBPUSD » Learn To Trade

A fakey pattern in the market means that a false-breakout of an inside bar pattern has occurred. In other words, a fakey is when price initially breaks one way from an inside bar pattern but then price snaps back the other direction, creating a false break of the inside bar structure. Now, as I mentioned previously, the meaning behind a fakey is what really attracts my attention when I see one on the charts.

Either way, the fakey setup is a very strong signal that price may continue to move in the direction opposite the false-break. Note that first there is an inside bar, followed by a false-breakout of that inside bar pattern which results in the fakey pattern forming:.

My Last 3 ‘Forex Fakey’ Trade Setups | » Learn To Trade

Not every fakey signal will look exactly like the ones above, there are variations of the fakey pattern, which I cover more extensively in my price action trading course. In the example below, we see a bullish and bearish fakey pattern with a pin bar reversal as the false-break of the inside bar pattern:. Your stop loss would most logically be placed just below the lowest point of the two-bar false-break. This fakey formed at what I would call a confluent chart level because we had multiple supporting factors for the trade; in this case the support level and the uptrend:.

Notice how price not only reversed to the downside after this fakey, but it actually kicked off a new downtrend…. The KEY defining characteristic of a good fakey signal is a CLEAR false break of the inside bar structure. If you have an OBVIOUS false breakout of an inside bar, then you may just have a good fakey on your hands, assuming it has some confluence and makes sense in the context of the market.

The fakey pattern is an extremely powerful price action pattern if you know how to properly spot it and trade it. Amateur and beginner traders often get caught up in buying breakouts. Indeed, there are entire trading strategies and systems built around trading breakouts. Breakouts are one of the oldest and most over-used trading approaches in existence, and for that reason, they are easily snuffed out and taken advantage of by the bigger market players, whilst smaller retail traders are usually the ones getting taken advantage of.

I invite you to learn more about this topic and get my price action trading course , because that is where I coalesce all of my knowledge and experience on the fakey pattern and exactly how to trade it properly.

Thank you Nial, I have lost thousands of dollars before I found your website. May our Father in Heaven bless you abundantly for not being selfish. Nial, you are a Redeemer.

You have simplified the seemingly difficult forex trading with your down to earth expositions. Thanks Mr Nail your explanation is always to the point and always gain something from your topic. Thanks Nial, much appreciate your contribution. My trading eye sight is improving with your wisdom. Thanks Nial, have thoroughly enjoyed this article as this is what I have enjoyed the most in price action. Hi Nial, From the last 5 years I am reading your writings. I have learned many things from this sites.

I like to give you a special thanks. I think I have got a full idea about forex not only trading but also all aspects about trading.

When I was functioning with your trading approach, my performance was better. But now… Coming back to my ROOT. Your email address will not be published. Notify me of follow-up comments by email. Notify me of new posts by email.

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My Last 3 ‘Forex Fakey’ Trade Setups | » Learn To Trade

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Please remember that the past performance of any trading system or methodology is not necessarily indicative of future results. What Is A Fakey Pattern and How Do You Trade It? By Nial Fuller in Forex Trading Strategies 24 Comments. What is a fakey price action pattern?

Note that first there is an inside bar, followed by a false-breakout of that inside bar pattern which results in the fakey pattern forming: In the example below, we see a bullish and bearish fakey pattern with a pin bar reversal as the false-break of the inside bar pattern: This fakey formed at what I would call a confluent chart level because we had multiple supporting factors for the trade; in this case the support level and the uptrend: Notice how price not only reversed to the downside after this fakey, but it actually kicked off a new downtrend… Caveats to the fakey: Final word on the fakey pattern The fakey pattern is an extremely powerful price action pattern if you know how to properly spot it and trade it.

Related Trading Lessons Trading Breakouts Often Leads to Losing Trades. Now I want to hear from you!

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