You’ve probably heard of POI in trading groups, but do you really know what POI is and how to use it to your advantage? POI is basically a Point of Interest — an area on the chart where the price tends to have a strong interaction, whether to reverse, break a resistance, or attract liquidity.

The idea is simple: the price leaves clues on the chart. When you see a giant candle with a long wick, a price gap, a false breakout, or an area where a lot of orders have accumulated, all of these signal a POI. The market treats these points like a magnet — the price will return there again, no matter what.

The most common POIs you’ll encounter are explosive candles (those with huge volume that push the price all at once), rejection candles with long wicks, areas where liquidity was lacking to fill, and clear supply and demand zones. Each of these patterns tells a story about what the big players did.

Now, what is POI in practical terms for you as a trader? It’s basically a map. When the price revisits these points, you have an entry opportunity with controlled risk. Place your stop loss 10 to 15 points beyond the POI, watch for reversal signals — a hammer candle, for example — and that’s it. If the RSI is at 70 when the price hits the POI, then it’s a more confident sell opportunity.

Let me give you a meaningful example: imagine a giant 15-minute candle that pushes XRP from $1.9500 to $2.0000 in one minute. That $1.9500 to $1.9600 area becomes a clear POI. Hours later, when the price returns there, stay alert. If a reversal candle appears in that zone, it could be the moment to anticipate a move back to $2.0000. Of course, manage your risk by watching if the price drops below $1.9450.

But here’s the important detail: POI doesn’t work alone. You need to understand the overall market structure — whether it’s in an uptrend or downtrend — and let the POI work in your favor, not against you. If there’s an EMA 50 or 200 moving average passing through there, even better. And volume? If the POI reverses with strong volume, it’s practically a confirmation of fire.

The mistakes I see traders make all the time: entering before confirmation appears, ignoring the overall trend, blindly trusting the POI without risk management, or using POI on inappropriate timeframes. POI works best on 15-minute charts for scalping or on larger timeframes for swings, but you need discipline.

So when someone asks you what POI is, you already know: it’s where the market left its footprints, and you’re there to take advantage when it comes back.