Stop Hunt

A stop hunt is a price action phenomenon where the market—driven by large participants with visibility into the order book—temporarily moves to a level where retail traders' stop-loss orders are clustered, triggering those stops and generating selling or buying pressure that allows the large participant to enter at a more favourable price before the market reverses. Common stop hunt zones include just below recent swing lows (where long stop-losses sit) and just above recent swing highs (where short stop-losses are placed). Recognising stop hunts helps traders avoid placing stops at obvious, crowded levels. Smart Money Concepts practitioners use stop hunts as entry signals—looking to enter in the reversal direction after the stop run is complete.