This is another of the structural movements that characterizes the algorithm as well. I'm talking about AMD (accumulation, manipulation, distribution).
And this happens because the market operates with liquidity, but that liquidity is constantly entering and exiting. So, if the market opens and there isn't enough liquidity to move the price, the market needs to build that liquidity.
This construction develops through a consolidation range, and in this way, liquidity is generated above and below it in the form of stop losses, settlement points, buy orders, sell orders... in short, there is pending money above and below it.
Then the manipulation begins. What this movement does is activate those pending orders, remove stop losses, liquidate positions, and once the liquidity is withdrawn at one of the two extremes (in this example, the lower side), then the price has no choice but to move to the other side of the range because that's where the next reserved liquidity is.
...and as traders, we have a great advantage: we know exactly what the market is doing: going up and down... even when it's in a narrow sideways range, the price continues to go up and down; it's inevitable; it can't stop doing so.
And well, once that previous consolidation is manipulated, the price enters a distribution phase to deliver liquidity to the other side of the range.
This happens in all timeframes and in all markets: forex, indices, stocks, cryptocurrencies, etc.
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