Premarket Prep GBPNZD 20210511

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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 19 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

• Min. 3 times hit­ting the gym + manda­to­ry cardio
• Trad­ing rules
  • M15/M30 entries and exits at 1st DTTZ, M5 entries and exits at 2nd DTTZ
  • Only price-action based exit rules (or if hit time stop comes earlier)
    • Oth­er­wise a Bart Simp­son exercise
    • Doing one now

Com­pared against Week­ly Trad­ing Plan

• Trad­ing above last week’s body but still with­in range

Non-con­jec­ture obser­va­tions of the market

• Price action
  • D1 Morn­ing Star with huge con­tin­u­a­tion high­er clos­ing deep with­in D1-C‑S 1.93070
  • Price took out H4 sup­ply and hit the next at H4-C‑S 1.94650 (near H4 200MA in R, trad­ing above H4 UKC in R)
  • Price trad­ing below H4 QHi after hav­ing react­ed off H4 QLo above D1/W1 QLo
  • Pos­si­ble H4 speed­bump although extend­ed above H4 VWAP in R
• Trend: H4 UP, D1 DOWN, W1 UP
  • Pre­vail­ing trend: Mixed Trend. Trend was down and H4 changed to Up form­ing a mixed trend. 
• Mar­ket Profile
  • First val­ue cre­at­ed above the 4 con­sec­u­tive val­ues in DT
• Dai­ly Range
  • ADR: 1303
  • ASR: 908
    • 23
  • Day
    • Yes­ter­day’s High 1.94492
    • Yes­ter­day’s Low 1.92290

Sen­ti­ment

• Loca­tions
• Sen­ti­ment
  • LN open
    • Above Val­ue, Out­side Range
  • Open dis­tance to value
    • 0.9xASR
  • Pre­mar­ket
    • H4 closed down but with long buy­ing wick.
  • Nar­ra­tive
    • Large Imbal­ance. Price might go test (or take out) D1 Sup­ply. If it takes out sup­ply there could be a con­tin­u­a­tion high­er. Although with the large imbal­ance at the open and near­by old H4 sup­ply there could be a poten­tial rever­sal or mean reversion. 
• Clar­i­ty (1–5, 5 being best)
  • 4
• Hypo 1 — Mean Reversion
  • Nar­ra­tive: Open sen­ti­ment. Near­by supply. 
  • Pre­ferred: Strong bear­ish PA, and IB exten­sion down or a (quick) failed auc­tion if there is an ini­tial exten­sion up.
  • Con: No clear rever­sal on H4, if D1 sup­ply gets tak­en out
• Hypo 2 — Return to Value
  • Nar­ra­tive: Vari­a­tion to Hypo 1
  • Pre­ferred: test of val­ue edge at LTF demand with bull­ish PA to Sin­gle Print Fade or TPO struc­ture build up reversal. 
  • Con: tak­ing out of H4 demand
• Hypo 3 — Trend Continuation
  • Nar­ra­tive:  Con­tin­u­a­tion to D1 move, H4 poten­tial speedbump, 
  • Pre­ferred: Strong Bull­ish PA, IB exten­sion up tak­ing out D1 sup­ply, sus­tained auc­tion exhaust­ing ADR 
  • Con: yes­ter­day was a uni­di­rec­tion­al day, anoth­er D1 sup­ply overhead. 

Addi­tion­al notes

• Cap­i­tal Preser­va­tion Rule in effect

ZOIs for Pos­si­ble Shorts

• D1-C‑S 1.94900
• H4-C‑S 1.93850
• D1‑C‑S 1.93070

ZOIs for Pos­si­ble Long

• D1‑C‑D 1.92400
• H4-C‑D 1.92030

Mind­ful Trad­ing (lack of sleep?)

• Feel­ing okay

Focus Points for trad­ing development

• Month­ly Goals
  • No momen­tum trades on Non-Farm Fridays
  • Feel­ing okay with NOT trading
  • Have ‘qui­eter’ weekends
• Week­ly Goal
  • Min. 3 times hit­ting the gym + manda­to­ry cardio
  • Trad­ing rules
    • M15/M30 entries and exits at 1st DTTZ, M5 entries and exits at 2nd DTTZ
    • Only price-action based exit rules (or if hit time stop comes earlier)
      • Oth­er­wise a Bart Simp­son exercise
• Risk Man­age­ment
  • With­out forc­ing a trade: aim to take 1 trade a day, if pos­si­ble 2. 
  • Cap­i­tal Preser­va­tion dur­ing draw­down allows for 1R profit-taking
  • 2 con­sec­u­tive days of lack of sleep = NO TRADING

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