Complete XAUUSD Trade Example: MSS + FVG Under the Five Rules
A fully annotated 5-rule gold trade walkthrough: sell-side sweep, New York killzone, 1-minute market structure shift, FVG entry, and journal grading.
Setup: the morning read (Rule 1)
Context: gold closed yesterday near its low after delivering down from the previous day high (PDH) at 2680. Overnight, Asia built a tight range 2652–2660. Price is now trading in discount of yesterday's dealing range, and yesterday's low (PDL) at 2648 has not yet been swept.
The bias sentence writes itself: "Bias long below 2652 — gold is in discount, sell-side liquidity rests under the Asian low and the PDL, and the draw on liquidity is the PDH at 2680." Now the only question is time and sequence.
The sweep and the shift (Rules 2, 3, 4)
At 7:40 AM EST — inside the New York killzone — price displaces below the Asian low and sweeps the 2648 PDL, printing 2645.50 before rejecting sharply back above 2648 within two minutes. Rule 2: we're inside the window. Rule 3: sell-side liquidity is taken with energy — this is a sweep, not a break.
On the 1-minute, price then breaks the most recent lower high with a large-bodied candle leaving an FVG at 2649–2651. That is the MSS with displacement — Rule 4 confirmed. The sequence the five rules exist for is now complete: direction, time, liquidation, confirmation.
Execution and invalidation (Rule 5)
The entry model: the 1m FVG at 2649–2651, confluencing with the origin candle of the displacement. Entry at the 2650 rebalance. The stop goes below the swept low at 2645.00 — the objective invalidation, since a close there means the sweep failed and the lows are the real story.
Risk: fixed at 1% of the account. Size = risk ÷ stop distance (5.00 per ounce). First target 2660 (Asian high, internal liquidity), final target 2678–2680 (the PDH pool) — roughly 1:6 to the final target on a 5-dollar stop. The trade is logged in the journal before or as it runs — never after.
The grade
Outcome aside, the trade scores: bias written (✓), inside NY killzone (✓), sell-side sweep (✓), MSS with displacement on the 1m (✓), FVG entry with defined invalidation (✓). Five of five — a full A+ setup by the system's definition.
That grading is the product. In SMC Ledger this trade appears in your history with its rule scores, and your dashboard asks the only question that matters over time: do your 5/5 trades outperform your 3/5 trades? In our experience of how this data goes — they do, dramatically — but the point is that you'll know, from your own numbers.
Common questions
What if price never retraces into the FVG?+
The trade never happens. A missed trade is free; chasing the retest pays the spread for the same setup with a worse stop.
Would this setup also work in London?+
Yes — the sequence is session-agnostic. London would sweep the Asian range instead of the PDL; everything else in the five-rule chain stays identical.
Related lessons
8 min read
How to Trade Gold (XAUUSD) with Smart Money Concepts
Why XAUUSD respects Smart Money Concepts better than almost any market, and how to map the five-rule system onto gold's sessions and liquidity levels.
7 min read
XAUUSD London and New York Killzone Setups
The two highest-probability gold sessions: how London sweeps the Asian range on XAUUSD and how New York delivers the day's real move.
