Have you ever experienced this—when the market suddenly plunges at a critical point, your stop-loss is triggered instantly, and just as you cut your losses, the price reverses and moves back up? This is not just a matter of luck, but a trap carefully laid out by large players. Statistics show that about 90% of retail traders in the derivatives market have experienced similar regret after being forced to sell at a loss.

**The underlying logic behind the market manipulators' harvesting is actually not complicated**

They leverage their capital advantage to precisely create volatility that triggers retail traders' stop-loss orders, then quickly push the price back. In simple terms, they exploit human weaknesses and trading habits to harvest liquidity.

There are three common manipulation tactics:

**Tactic 1: Stop-loss Hunting**

Retail traders tend to place stop-loss orders just below round numbers or obvious support levels, which actually guides big funds where to target. They use large orders to break through these key levels, triggering a flood of stop-loss orders at once. Once liquidity is absorbed, the price immediately rebounds, leaving retail traders trapped at unreasonable levels.

**Tactic 2: Fake Breakouts**

When a ranging market is about to end, the market manipulators suddenly increase trading volume to break through resistance levels, creating a false impression of a "trend initiation." Technical traders see the breakout signal and chase the rally, only to get caught in the trap. The price then quickly falls back, perfectly harvesting retail traders.

**Tactic 3: Emotional Manipulation**

They create fragmented positive or negative news through various channels, combined with candlestick patterns to induce panic or greed. Retail traders, caught up in heightened emotions, follow the trend, becoming the opposite side of large players' distribution or accumulation.

**Why are retail traders so easily fooled?**

Ultimately, it boils down to four psychological vulnerabilities:

First is **overconfidence**—believing they can precisely predict short-term fluctuations, underestimating market randomness, and easily adding leverage to chase trades.

Second is **herd mentality**—fearing missing out when others profit, so 30% of traders follow the trend, and the rest become restless. This cascade effect ultimately drags in the last to enter, the so-called "bag holders."

Third is **mental accounting**—losing money makes traders eager to recover losses, leading to increased investments, which results in even greater losses.

Finally is **time pressure**—in rapidly changing markets, rational decision-making ability drops significantly, often leading to regretful choices afterward.

Once you understand these tactics and weaknesses, you should think differently during trading: avoid setting stop-losses at obvious levels, learn to identify fake breakouts, and stay alert to emotional signals. Most importantly, accept that you cannot precisely predict every move, and maintain humility and risk awareness.