In the previous week the valuable members of the Trading Forum reminded me of a crucial point in our day-to-day trading which is simplicity. With that said, I have taken a deep breath and have cleaned my charts to the very basics of my trading approach. This step brought me an increase in calmness, focus and last but not least a boost in my trading performance. Also noteworthy is the fact, that it allows me to scan an increased number of markets for potential trades as I need less time to analyze a market and less information to consider a trade with the best risk:reward. To make it short: Actually, I looked only on plain charts in the previous week without VWAP, TPO/Volume profile, Cumulative Delta or god mode data feed. And I can tell you, it is better than great!
Anyway, I’ve thought to provide you with a market review on Gold (XAU/USD) today. As usual, I like to take a look at the real macro chart with Yearly bars to keep in mind the told story about a market. In this case we can observe a potential macro balance area and the market seems to be heading towards to the balance area high extreme.
However, I will skip the part in which we would analyze the next periodicity (Yearly -> Quarterly -> Monthly etc.) as most of you are intra-day traders. That said, we will step ahead to the weekly timeframe and as mentioned we keep it very simple. Looking at this nice chart you can clearly identify the current balanced behavior in this market:
In a balanced behavior you want to lean on the balance or value extremes. These extremes are highlighted on the daily chart:
Actually, we had an inside day failure on the balance area high extreme which made me very bullish on that particular day. Anyway, the big trade of the week was from the weekly developing VWAP VAH level which was pretty confluent with a previous VAH close level and the mentioned balance area high extreme from the daily chart. Now, the thing is that there is a way to explain this trade in a more simple way without VWAP but this is something that our members can easily figure out which followed the discussions on the forum closely.