Hi everyone,
I’m working on a trading approach for NQ and GC futures and would appreciate feedback or perspectives from anyone familiar with intraday structure and market cycles.
My current strategy revolves around identifying daily liquidity sweeps and key price imbalances areas where price might naturally gravitate. Once I determine whether the broader market is trending or ranging, I drop to the 1-hour timeframe to frame my trades.
Here’s what I’ve observed:
• I look for hourly candles that reach about 1 standard deviation (1 SD) from their open but don’t sweep the opposite end before doing so.
• I define the first such candle as the “anchor candle” and the following one as the “expansion candle.”
• Often, price briefly tests the equilibrium or 0.75 level of the previous H1 candle (sometimes within minutes) before continuing its move through that 1 SD range often without breaking back below the previous low.
• In some cases, it takes two candles after the anchor candle for this expansion behavior to fully play out.
I also integrate VWAP into my analysis to confirm direction and watch how the developing “expansion” candle behaves around VWAP at its open. On the 1 minute timeframe, I like to study what the last hourly candle actually did whether it showed trending or ranging behavior before committing to the trade idea.
As for weekly timing, I notice that certain day combinations (like Monday–Tuesday or Thursday–Friday) sometimes produce more favorable setups depending on the week within the month and the macro news cycle.
I realize this idea may still be basic or unpolished, but it feels like there’s something to it especially in how price behaves around the 1 SD level and VWAP alignment. I’d really appreciate any insights on:
• Whether this concept aligns with known cycle or volatility models.
• Ways to more objectively define or backtest the “anchor” and “expansion” phases.
• Thoughts on refining my understanding of when conditions favor expansion vs. mean reversion.
Thanks in advance for any feedback or pointers I’m open to constructive critique or suggestions on how to make this framework more robust.

Tripl3MMM 

I look for hourly candles that reach about 1 standard deviation (1 SD) from their open but don't sweep the opposite end before doing so.

@Tripl3MMM,

Your framework has more statistical backing than you might realize. NQ hour stats data shows that when an hour opens inside the prior hour's range and sweeps the high or low, there's a 75%+ probability of price returning to the current hour's open -- but only for early-hour sweeps (first 20 minutes). The probability drops significantly for mid-hour and late-hour sweeps. That timing distinction is critical for your anchor/expansion concept.

What you're calling the "anchor candle" maps closely to what some volatility researchers call the "range establishment" phase, and your "expansion candle" aligns with the breakout continuation phase. The fact that you're seeing price test the 0.75 level of the prior H1 candle before expanding isn't random -- it's consistent with liquidity pool theory where market makers need to fill orders at specific price levels before allowing directional moves.

For backtesting, here's what I'd do:

• Define your anchor candle programmatically: H1 candle where (High - Open) or (Open - Low) reaches 1 SD of recent hourly ranges, but the opposite side stays within 0.5 SD
• Track the next candle's behavior relative to the anchor's 0.5 and 0.75 levels
• Log the time-of-day for each setup -- your Mon/Tue and Thu/Fri observation likely ties to institutional rebalancing flows
• Separate results by VIX regime (above/below 20) to address your expansion vs. mean reversion question

On regime identification -- VWAP slope over the prior 2 hours is a solid filter. Flat VWAP = mean reversion environment, steep VWAP = expansion favored. Combine that with whether the hourly ATR is above or below its 20-period average and you've got a decent regime classifier.

One thing worth checking: there's a TradingView indicator called "NQ Hourly Standard Deviation Zones" that plots energetic support/resistance based on historical SD levels from the hourly open. Could save you some manual charting time.

GC will behave differently from NQ on this framework -- gold's intraday volatility curve is less U-shaped and more sensitive to London/NY session overlap. I'd backtest them separately.

-- Fi
"The best trading frameworks aren't invented -- they're discovered in the data and then pressure-tested until they break."

Welcome to the forum.

Curious, is this for an auto traded, or for a personal traded acccount. I do not use the chart as much as I should, but a 45 min NQ chart is used for support and resistance. For a cycle or pattern I look at how has it been lately, the last hour or two, day or two, week or two, month or two, year or two can all factor into a single day trade.