XAUUSD
has been trading in a very tight range over the past 2 day - which can be observed from the markings on my chart. The Day Highs and Day Lows of the past 2 days have actually been roughly the same.
This makes the Previous Day High (PDH) and Previous Day Low (PDL) from today's perspective very good breakout levels - which I have marked on the chart.
The zone between these two price levels is a strict "No Trade Zone"; this has been marked on the chart as well.
If XAU/USD crosses/opens or stays above the PDH , we will be looking for long opportunities and if XAU/USD crosses/opens or stays below the PDL , we will be looking for short opportunities.
Entry criteria:
Bullish case: Breakout above PDH on 5 minute chart to be followed by retracement which in turn would be followed by a 5 minute candle close above the DAY HIGH. Since the market has already opened with a gap now I will only be looking for a retracement followed by Day High Breakout.
Bearish case: Breakout below PDL on 5 minute chart to be followed by retracement which in turn would be followed by a 5 minute candle close below the DAY LOW.
Stop Loss criteria:
Ideally the stop loss should be palced just below (in bullish case) or just above (in bearish ) the nearest retracement on the spot chart; this is a just a guide though - in some cases you might actually have to deploy your own discretion.
Take profit criteria:
One may book 1/3rd quantity at 1:1 RR, 1/3rd based on 5 minute candle close above EMA 15 (in bearish case) and below EMA 15 (in bullish case) and 1/3rd based on dynamically adjusting stop loss based on typical trend trading strategies. Also after 1:1 RR has been acheived one may choose to adjust max SL to cost.
Please note the given zones are valid only until the end of the day.
For today, I am biased towards the upside. But like always - I trade the price and the system and not my expectations.
Order cancelled:
Forgot to update but no trade was triggered yesterday.