Premarket Prep USDCAD 05142020

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:

http://bearmarkettrader.com/2020/05/09/usdcad-week-20-trading-plan/

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

Non-conjecture observations of the market

• Price within MN1/W1 QHi
• Weekly Phase 3 still in effect
• D1 QPs acting as bounce points within weekly distribution range
• Return to D1 QHi and Supply ZOI 1.40962 (established beginning April) with some lower time frame congestion in its path
• H4 showing multiple demand ZOIs trending up
  • Weekly trend is up, Daily down, H4 up
• Price slightly above D1 QHi but tested H4 QHi with small inside bar creating a supply ZOI aligning newly formed H4 supply conterminous almost exactly with previously established Daily conterminous 1.40962
  • H1 testing this level and formed a bearish engulfing during AS but no push lower
• Market Profile
  • AS opened above PVAH and range in a consolidating pattern below prev day high 1.41146
  • Currently price trading above PVAH and range of the London session
• Side note: M30 KC channel trending up, although price re-entered KC it is still above VWAP

Sentiment – Slightly Bearish

ZOIs for Possible Shorts

• D1 Supply ZOI 1.40962 / D1 QHi

ZOIs for Possible Long

• H4 Conterminous Demand 1.40528 (PVAH area)

Focus Points for trading development

• Exit rules
  • Option 1: hold trade until noon (London time)
  • Option 2: Target hit (SL 20 pips 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
  • Use TPO confirmation or invalidation for directional decisions by looking for 
    • 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
  • No staring at M5 chart
  • Trade needs to have a target that has the chance of hitting min. X2 R/R
  • Can’t re-enter a trade for one hour after a loss