Why stop-loss hunting targets clusters, not individual traders
Retail traders who get stopped out are not being personally targeted — they are standing in an obvious spot, which is reassuring in one way and a warning in another.
- Quant firms cannot see individual accounts or a single trader's stop order.
- What they can see is the cluster: thousands of stops bunched under the same obvious low.
- That cluster shows up in how price behaves near the level, which makes it a landmark on every serious trader's map.
- Getting swept is collateral damage from parking next to that landmark, not a hit on any one person.
Outlook: Stops placed at the same obvious levels everyone else uses will keep getting swept, so the fix is choosing less crowded ground.