What Is Stop Hunt?
A stop hunt is a deliberate price move engineered by large players (whales or market makers) to trigger a cluster of stop-loss orders at a well-known level. When stops are triggered, they become market orders that create liquidity — which the large player uses to fill their own position in the opposite direction at favorable prices.
How Stop Hunt Works
Stop hunts are identifiable by their signature pattern: price aggressively moves past a key support or resistance level (triggering stops), creates a wick, and then reverses sharply back inside the range. The volume spike at the wick tip confirms stops were triggered. This is especially common around round numbers, recent swing highs/lows, and obvious trendlines.
Why It Matters for Traders
Anticipating stop hunts is a significant edge. Rather than placing stops at obvious levels (just below support, just above resistance), professional traders either use wider stops beyond the likely hunt zone, use mental stops, or set entries at the levels where stops will be hunted — buying exactly where retail traders are stopped out.
