{"id":3236,"date":"2026-08-11T18:44:12","date_gmt":"2026-08-11T18:44:12","guid":{"rendered":"https:\/\/propvator.com\/blog\/how-to-trade-against-retail-traders-and-become-profitable\/"},"modified":"2026-08-11T18:44:12","modified_gmt":"2026-08-11T18:44:12","slug":"how-to-trade-against-retail-traders-and-become-profitable","status":"publish","type":"post","link":"https:\/\/propvator.com\/blog\/how-to-trade-against-retail-traders-and-become-profitable\/","title":{"rendered":"How to Trade Against Retail Traders and Be Profitable"},"content":{"rendered":"
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<\/span>Trading Talk with Eman · Ep. 28<\/span><\/div>\n<\/div>\n
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Over 70% of retail traders lose money. So why not do the opposite of what they do? It is absolutely possible, and it is what most institutional traders do.<\/p>\n

Institutions have better tools and data than retail, but the real edge is simpler. They understand retail behaviour and they trade against it, and you can learn to do the same.<\/p>\n<\/div>\n

Key takeaways<\/h3>\n
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1<\/span><\/div>\n
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Do the opposite<\/div>\n

Since over 70% of retail traders lose, understanding their common behaviour and trading against it puts the odds back in your favour.<\/p>\n<\/div>\n<\/div>\n<\/div>\n

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2<\/span><\/div>\n
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Wait for the real break<\/div>\n

Retail rushes to trade the first move out of a range, so wait for a full breakout and a retest before you enter.<\/p>\n<\/div>\n<\/div>\n<\/div>\n

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3<\/span><\/div>\n
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Be patient, do not predict<\/div>\n

Retail is impatient and tries to predict price, so your edge is following what price actually does and waiting for confirmation.<\/p>\n<\/div>\n<\/div>\n<\/div>\n

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4<\/span><\/div>\n
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Follow the trend<\/div>\n

Retail sells uptrends thinking price is expensive, but there is no expensive or cheap, so join the momentum until it weakens.<\/p>\n<\/div>\n<\/div>\n<\/div>\n

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5<\/span><\/div>\n
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Widen your stops<\/div>\n

Retail sets stops too tight just under the higher low, so give yours more room or use that level as your entry for a better risk to reward.<\/p>\n<\/div>\n<\/div>\n<\/div>\n

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6<\/span><\/div>\n<\/div>\n
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Check IG client sentiment<\/div>\n

IG publishes what its traders are buying and selling, and since most lose long term, a heavy crowd position is a useful counter signal.<\/p>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n

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Ranging markets and fake breakouts<\/h3>\n
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Picture a range as a box, with support at the bottom and resistance at the top. It is not a great condition to trade, and many mentors say avoid it, but retail trades it anyway and mostly loses.<\/p>\n

What retail does is jump in the moment price pokes slightly above or below the box. They are quick to predict, so they hit buy on a small break of resistance. Institutions know this and sell into it, and that is your fake out.<\/p>\n

In practice, do not chase that first move. Wait for price to fully break out without reversing, then wait for it to come back to the resistance level a second time. That retest is a far better entry.<\/p>\n<\/div>\n

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“You wait for price to fully break out without a fake out, then buy the retest, not the first move.”<\/p>\n<\/div>\n

Trending markets and the mistakes retail makes<\/h3>\n
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In an uptrend price makes higher highs and higher lows. Newer traders sell into it because they think price is too expensive, but there is no such thing as expensive or cheap with currencies.<\/p>\n

The vast majority of the time, if price is going up it keeps going up until you see signs of reversal, so join the momentum instead of fighting it. Watch for weak rejections and smaller candle bodies, and that is when buyers are getting tired.<\/p>\n

More experienced retail traders do buy the uptrend, but they set stops way too tight, right under the higher low. A deep retracement hits those stops and then price goes back up. So widen your stop, or put your entry near that higher low for a better risk to reward and a higher win rate.<\/p>\n<\/div>\n

A bonus tip: IG client sentiment<\/h3>\n
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There is a well known regulated broker called IG that actually publishes its traders’ activity in real time, showing how many are buying and selling a pair.<\/p>\n

Search IG client sentiment followed by the pair, for example EUR USD, and you might see 80% buying. At the same time the site discloses that around 65% of their traders lose money.<\/p>\n

So if 80% are buying and most lose long term, maybe that is not a good buy. I use it as a confirmation. When I am about to sell and I see most retail buying, that adds confidence. It does not work every time, because nothing does, but over the long term the crowd loses.<\/p>\n<\/div>\n

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Find your prop firm on Propvator<\/div>\n

If you have the skill but need capital, compare reliable prop firms with fair conditions on Propvator.<\/p>\n