A whipsaw is a sharp price move in one direction that quickly reverses, trapping traders who just entered. It is common in choppy, low-conviction markets and around news, and it often triggers stop losses right before price snaps back the other way.
Forex Term
Whipsaw
A sharp move that quickly reverses and traps traders.
Example
Price spikes up, hits your buy entry, then drops straight through your stop — a classic whipsaw.
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Risk
Forex and CFD trading involves significant risk of loss and is not suitable for all investors. Leverage can work against you. This content is educational and not financial advice — always do your own research.