The London open at 08:00 GMT brings peak trading volume for XAU/USD. For day traders, this session delivers reliable breakout setups with defined risk parameters.
Step 1: Mark the Asian High and Low
Plot the highest high and lowest low from 00:00 GMT to 07:00 GMT. A tight range under 80 pips ($8.00) indicates high potential expansion during London hours.
Step 2: Spot the Sweep
Liquidity sits above the Asian high and below the low. Before London opens, price often dips 15-20 pips below the range low to sweep stop losses before turning higher.
Step 3: Execution Rules
- Entry: Buy when a 5-minute candle closes above the Asian high after a confirmed sweep.
- Stop Loss: Place your stop 15 pips below the recent swing low.
- Take Profit: Target Daily R1/R2 pivot levels or a 2.5x risk-reward ratio.