AAPL ShortWe can observe that price has recently rallied into a higher timeframe premium zone, which acts as a potential supply area where institutional traders may look to offload positions. The reaction from this zone aligns with the idea that aggressive buying into premium areas can attract counter-order flow.
After this strong impulsive move upward, price tapped into the higher timeframe sell zone and appears to be rejecting it, forming a short-term shift in momentum. The marked arrow suggests a potential short scenario, targeting a reversion to the nearby inefficiency and resting liquidity just below the recent breakout structure.
The green highlighted area shows a logical draw on liquidity where sell-side liquidity may be resting. This is where price is expected to seek out stop orders from late buyers who entered at the top.
Liquidity Perspective:
Notice how previous swing lows and highs provide clear liquidity pools for price to manipulate. Price behavior around these levels often indicates the intention of larger players to grab liquidity before moving in the opposite direction.
Risk Management:
As always, traders should manage risk appropriately by defining clear invalidation levels and never risking more than a small percentage of their capital per trade. Proper risk-to-reward planning ensures sustainability and discipline when executing this strategy.
