Premarket Prep USDCAD 05282020

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

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

Non-con­jec­ture obser­va­tions of the market

• After a big drop from reject­ing W1 QHi we took out Dai­ly demand but yes­ter­day we stayed around this level
• Bounce off of pre­vi­ous H4 Demand (1.37297) with Bull Engulf but no fol­low through and cre­at­ed anoth­er con­ter­mi­nous sup­ply at 1.37783
  • Price below KC and VWAP
• Price test­ed new H4 con­ter­mi­nous sup­ply 1.37783 dur­ing Asia ses­sion after cre­at­ing some demand with new H4 con­ter­mi­nous demand 1.37525
• Mar­ket Profile
  • Lon­don opened with­in value

Com­pared against Week­ly Trad­ing Plan

• W1 Phase 3 demand bro­ken and test­ing Week­ly VWAP
• First time duck­ing below Month­ly con­ter­mi­nous sup­ply 1.38162

Sen­ti­ment — Bearish

ZOIs for Pos­si­ble Shorts

• New H4 con­ter­mi­nous sup­ply 1.37783

ZOIs for Pos­si­ble Long

• New H4 con­ter­mi­nous demand 1.37525
• H4 con­ter­mi­nous demand 1.37297

Focus Points for trad­ing development

• Exit rules
  • Option 1: Time-based stop
  • Option 2: Tar­get hit (SL 20 pips + spread or x2 TP)
  • NO OPTION 3
    • UNLESS a trade is entered with­in 1 hour or half hour before the hard exit rule option 1
• Entry rules
  • Entry on TPO break of IB
  • Ear­ly entry with price action con­fir­ma­tion at 
    • H4 con­ter­mi­nous
    • Open far from val­ue, antic­i­pat­ing a move back to val­ue using an engulf­ing + sub­se­quent break of TPO
  • Min. X2 R/R
  • Use TPO con­fir­ma­tion or inval­i­da­tion for direc­tion­al deci­sions by look­ing for in con­junc­tion with H4 con­ter­mi­nous lines
    • TPO exten­sion with a sus­tained move (BO from IB)
    • TPO exten­sion with failed auc­tion (return to IB)
    • How this direc­tion of TPO exten­sion relates to Val­ue Area open sentiment
• I will post trades including:
  • Trade loca­tion
  • Price action entry condition
  • What were TPOs doing at the time
  • With screen­shot
• Keep own approach of KC, VWAP as odd enhancers instead of hard trade locations