Premarket Prep GBPNZD 02052021

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This is my pre­mar­ket prep for today’s Euro­pean ses­sion for the Forex pair GBPNZD. This prep builds off of my week­ly trade plan I made here:

GBPNZD Week 5 Trad­ing Plan

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The pur­pose of a pre­mar­ket prep is to find setups with­in my week­ly trade plan bias

Week­ly Focus Points

• Only take trades accord­ing to a hypo unless there are mul­ti­ple con­di­tions met

Com­pared against Week­ly Trad­ing Plan

• MN Morn­ing Star com­plet­ed last month with price cur­rent­ly trad­ing above last month’s body
• W1 Bull Engulf at MN-C‑D 1.89745 with a RBR of which the base has been retraced to and exceed­ed below test­ing MN demand for a 2nd time and price is cur­rent­ly trad­ing above last week’s body with a devel­op­ing long buy­ing wick (but we still need today to close for a confirmation)
  • Key point would be tak­en out sup­ply at W1 Sup­ply End 1.92156 (W1-C‑S 1.90631)
  • Price is trad­ing with­in W1 QLo (no close above yet)

Non-con­jec­ture obser­va­tions of the market

• Price action
  • D1 Bull Engulf at 50MA in R and MN demand reach­ing near UKC in R with price cur­rent­ly trade below D1-C‑S 1.91538
  • Price is in top half of D1 swing with no arrival at D1 QHi (yet)
  • Price tra­versed from H4 QLo on some momen­tum reach­ing QHi with a some­what clean arrival (although there was some slow­ing down but still a RBR was formed, no rever­sal sign yet)
  • Pre­mar­ket: Price retraced to H4-C‑D 1.91020 BASE lev­el but closed high­er form­ing an inside bar with long buy­ing wick
• Trend: H4 up, D1 up, W1 down
• Mar­ket Profile
  • 2‑day brack­et formed with yesterday’s val­ue being very wide indi­cat­ing a pos­si­ble pick­up in direc­tion­al behav­iour. Although cur­rent­ly the price is far above VAH that we might see a mean rever­sion first this could be the start of a new trend thus this would be risky at best. 
  • ADR: 1084
  • ASR: 848
    • 22
  • Day
    • Yes­ter­day’s High 1.91110
    • Yes­ter­day’s Low 1.88605

Sen­ti­ment

• Loca­tions
  • H4 QLo at VAH
  • ADR 0.5 and exhaus­tion low above VAH with­in range
• Sen­ti­ment
  • LN open
    • Above Val­ue, Out­side Range
  • Open dis­tance to value
    • 1xADR, 1.4xASR
  • Nar­ra­tive
    • Due to a poten­tial break above W1 QLo we could see the start of a new trend thus negat­ing a good mean rever­sion oppor­tu­ni­ty even though we opened far above VAH. Still due to H4 QHi and over­head we sup­ply we could see some push back here. H4 retraced back to a base lev­el sig­nal­ing a pos­si­ble ini­tia­tive from sell­ers to return to the ori­gin loca­tion at H4 QLo. 
• Clar­i­ty (1–5, 5 being best)
  • 4
• Hypo 1 — Swing Rever­sal / Mean Reversion
  • Nar­ra­tive: Price hav­ing retraced to a base lev­el plus con­sol­i­dat­ing below H4 QHi / D1-C‑S 1.91538 and open sen­ti­ment we could see a rever­sal here.
  • Pre­ferred: Con­fi­dent bear­ish price action, IB exten­sion down (or failed auction)
• Hypo 2 — Return to Value
  • Nar­ra­tive: medium/large time­frame pos­si­bil­i­ty for a push higher.
  • Pre­ferred: IB exten­sion down to Exhaus­tion lev­el, price action and pro­file con­firm­ing a rever­sal through TPO struc­ture build up or a failed auction. 
• Hypo 3 — Trend Continuation
  • Nar­ra­tive: pos­si­ble start of a new trend
  • Pre­ferred: Bull­ish Price action, IB exten­sion (momen­tum) tak­ing out over­head supply.

Addi­tion­al notes

• Non-farm today

ZOIs for Pos­si­ble Shorts

• H4-C‑S 1.91267
• D1-C‑S 1.90528
• W1-C‑S 1.90631

ZOIs for Pos­si­ble Long

• H4-C‑D 1.90020 BASE
• MN-C‑D 1.89745

Mind­ful Trading

• Feel­ing okay

Focus Points for trad­ing development

• Month­ly Goals
  • Con­tin­ue track­ing my DRC track­ing sheet
  • Focus on my own progress and less on others
  • Feel­ing okay with NOT trading
  • Have ‘qui­eter’ weekends
• Week­ly Goal
  • Min. 3 times hit­ting the gym
• Trad­ing Rules
  • Trade from D and upwards unless a pos­si­ble momen­tum trade, val­ue accep­tance or otherwise. 
• Risk Man­age­ment
  • 3 trades 1% risk, 3rd trade only if first 2 worked out
  • Cap­i­tal Preser­va­tion dur­ing draw­down allows for 1R profit-taking
  • 2 con­sec­u­tive days of lack of sleep = NO TRADING

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