XAUUSD TRADING STRATGEY THAT WORKS:
Hey guys in this post I will share a good scalping strategy that actually works in XAUUSD| Gold, you can use this strategy to trade XAUUSD on intraday basis/scalping.
There are many indicators and strategy which people follow as per their style and most of them choose almost traditional method like Moving average, Fibonacci, BB, MACD etc. But the strategy that I am going to share with you is pretty advanced and pretty profitable to find a good entry in both buy and sell side.
Tools Requirement:
The one and only tool that you require for this strategy to work is the Sierra Chart Platform, there are many other charting software available for the strategy that I am going to explain but the Sierra Chart overall is recommended to use this method/ strategy. You can download and install the Sierra chart from this link.
So, the method that I am going to share is called as “Stacked Volume Imbalance” and it is part of order flow Analysis.
What is stacked volume imbalance in the first place?
See, the market moves with the help of buyers and sellers so and when buy order equals to sell or vice versa then we can say that there is balance between buyers and sellers but when sellers outperform the buyers at a particular price level then we say that seller created imbalance at that particular price level and same complies in case of buy imbalance also.
Now look carefully in the chart given below, look at the highlighted price level, at price level of 1982 you can see that there are some red highlighted numbers, the numbers are highlighted because if you compare the sell contracts with respect to by contract at this particular price level diagonally you will find that the sell contract numbers are greater 250 % than buy contract. (Confused? Don’t worry just carry on...)
The Highlighted Numbers are:
22x10
27x7
23x1
5x3
14x6
33x11
45x11
49x27
Now just compare the red highlighted number diagonally with previous number from the top.
Compare 10 With 27
7 with 23
1 with 5
3 with 14 and so on
And if you check the difference between these numbers, you will find it equal to or greater than 250%.
So, whenever this happens this will highlight the number in red and this indicate that sellers outperforming the buyers at this level and whenever they aggressively placing order in a row (Stacking) this generate a resistance zone in case of selling imbalance and support in case of buy imbalance .
And whenever this selling imbalance zone get plotted on the chart this indicate a bearish move and we can add sell entry. So, this is very easy to find such entry for scalping XAUUSD or any other pair .
To know more about this tool, you can refer this article
The same happen in case of buy Imbalance. You can check the buy imbalance from the following image:
