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Crab market

A market moving sideways, going neither up nor down - crabs walk sideways.

Crab market is the crypto term for the condition equity traders call range or chop. Price oscillates within a band, trends fail quickly, and breakouts reverse.

It is the condition that punishes trend strategies hardest and the one in which most discretionary damage accumulates, because setups keep half-appearing. Recognising it early and either standing down or switching to a range approach is worth more than any adjustment to entries. See whipsaw.

Related: chop, whipsaw, range, boredom-trading

See it drawn

Original diagrams for the ideas on this page. Illustrative, not real market data.

A range beside a trendOne chart swinging between a flat floor and ceiling, another stepping upwards inside a pair of sloping lines.Range-boundresistancesupportprice bounces between two levelsTrendingthe trend channelhigher highs and higher lowsA range has two flat edges; a trend has two sloping ones.
Range versus trend. On the left price keeps bouncing between the same floor and ceiling, which is a range. On the right each high and each low is higher than the last, inside a pair of sloping lines called a channel.

Educational only, not advice. Spotted an error? Post in Site Feedback.