Premarket Prep USDCAD 05192020

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/2020/05/17/usdcad-week-21-trading-plan/

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

Non-conjecture observations of the market

• D1 big candle straight down from Supply ZOI conterminous 1.40928 to Demand ZOI
• H4 KC range still in effect, inside bar at LKC / D1 Conterminous Demand 1.39504 / D1 QLo retracing almost entire 1st candle
• Price overextended from H4 VWAP
• H1 Hammer just below H4 QLo (less reliable although did move back down)
• M30 showing a downtrend but with price moving back up over VWAP however still below LKC
• Market Profile
  • Price below London PVAL+range
  • NY showing another B profile indicating a sell off
  • HK retraced a bit of NY

Compared against Weekly Trading Plan

• Price almost entirely retraced the Weekly Phase 3 range down from previous week
• Developing MN candle at bottom of previous month’s inside bar

Sentiment – Slightly Bearish

ZOIs for Possible Shorts

• W1 QHi around PVAL
• Break of H1 Demand ZOI 1.39238 – 1.39387

ZOIs for Possible Long

• D1 conterminous demand 1.39504
• H4 QLo
• D1 QLo

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
  • No staring at M5 chart
  • Trade needs to have a target that has the chance of hitting min. X2 R/R
  • 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
• 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