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Analysis of Trades and Trading Tips for the British Pound
Testing the price at 1.2978 coincided with the MACD indicator just starting to move up from the zero mark, confirming the correct entry point to buy the pound in the continuation of the upward trend. As a result, the pair moved up about 15 points before demand for the pound decreased. In the second half of the day, there are no important statistics, so attention will be focused on the speeches of Federal Reserve representatives. A hawkish tone from Federal Reserve Chairman Jerome Powell and a direct hint at maintaining rates unchanged despite inflation progress will lead to a rise in the dollar and a fall in the overbought pound. A dovish tone from the Fed Chairman will allow GBP/USD to continue its rise with updates to new monthly highs. As for the intraday strategy, I plan to act based on the realization of Scenarios No. 1 and No. 2 in the continuation of the trend.
Buy Signal
Scenario No. 1: Today, I plan to buy the pound when the entry point reaches around 1.2985 (green line on the chart) with a target of rising to the level of 1.3029 (thicker green line on the chart). Around 1.3029, I will exit purchases and open sales in the opposite direction (expecting a movement of 30-35 points in the opposite direction from the level). The pound's rise today can be expected to continue the upward trend, especially after Powell's speech. Important! Before buying, make sure that the MACD indicator is above the zero mark and just starting its rise from it.
Scenario No. 2: I also plan to buy the pound today in case of two consecutive tests of the price at 1.2958 when the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to a reverse market turn upward. Growth to the opposite levels of 1.2985 and 1.3029 can be expected.
Sell Signal
Scenario No. 1: I plan to sell the pound today after updating the level at 1.2958 (red line on the chart), which will lead to a quick decline of the pair. The key target for sellers will be the level at 1.2929, where I will exit sales and immediately open purchases in the opposite direction (expecting a movement of 20-25 points in the opposite direction from the level). Sellers will show themselves after an unsuccessful consolidation around the daily maximum. Important! Before selling, make sure that the MACD indicator is below the zero mark and just starting its decline from it.
Scenario No. 2: I also plan to sell the pound today in case of two consecutive tests of the price at 1.2985 when the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a reverse market turn downward. A decline to the opposite levels of 1.2958 and 1.2929 can be expected.
What's on the Chart:
Important. Beginner traders in the forex market should make market entry decisions very cautiously. It is best to stay out of the market before the release of important fundamental reports to avoid sharp exchange rate fluctuations. If you decide to trade during news releases, always set stop orders to minimize losses. Without setting stop orders, you can very quickly lose your entire deposit, especially if you do not use money management and trade large volumes.
And remember that successful trading requires a clear trading plan, similar to the one presented above. Spontaneous trading decisions based on the current market situation are initially a losing strategy for an intraday trader.