Hourly chart of the GBP/USD pair
The GBP/USD pair left the triangle on Tuesday, which we talked about in the last review. And so the trend was identified as an upward trend within the day. The price reached the 1.3876 level when the upper border of the triangle was crossed. Formally, novice traders could even use this breakout as a buy signal. However, in yesterday's article, we did not recommend trading bullish until the global downward trend line was overcome, which was eventually worked out today. In any case, you could make around 40 points of profit on a long position, if someone opened longs then that's good. We recommended selling the pair in case of a rebound from the trend line or in the event of a sell signal from the MACD indicator. No sell signal during the day. The pair's quotes reached the descending trend line by the end of the day and at the moment everything looks as if a rebound from this line has been made. If this rebound is not false, then the downward movement promises to be strong enough. Novice traders should already be short on this signal. The approximate entry point is the level of 1.3891. As a result, the MACD indicator also turned down, so beginners have a double sell signal at their disposal. Confusing, of course, the night is ahead, which means there is a high probability of a flat. Thus, we recommend waiting a couple more hours, perhaps the pair will go down by at least 15-20 points, afterwards you can set Stop Loss to breakeven. Overcoming the trend line - canceling the downward trend and closing short positions.
No major report or other event in the UK or US today. Thus, there was simply nothing for traders to react to during the day. Thus, at this time, technical analysis and signals remain in first place.
No important events scheduled in the UK on Wednesday, so the pair's movement can only be affected by the US inflation report. The more its actual value does not coincide with the forecast, the higher the probability of the markets working out this report. However, there is also the possibility that this report will be ignored, since the eurozone GDP report was just ignored.
Possible scenarios on March 10:
1) Long positions are irrelevant now, as the downward trend continues. Buyers need to wait for the price to settle above this trendline in order to consider bull trading. At the moment, there has been a rebound from it. If nothing changes during the evening, then the upward movement will be postponed for some time, as well as long positions.
2) Sell orders remain relevant, as the downward trend continues. Novice traders may have already opened short positions, since the price bounced off the trend line a few hours ago, and the MACD indicator generated a sell signal. So now we stay in shorts with targets at the support levels of 1.3855 and 1.3827. Stop Loss would ideally be set to breakeven before overnight trading.
On the chart:
Support and Resistance Levels are the Levels that serve as targets when buying or selling the pair. You can place Take Profit near these levels.
Red lines are the channels or trend lines that display the current trend and show in which direction it is better to trade now.
Up/down arrows show where you should sell or buy after reaching or breaking through particular levels.
The MACD indicator consists of a histogram and a signal line. When they cross, this is a signal to enter the market. It is recommended to use this indicator in combination with trend lines (channels and trend lines).
Important announcements and economic reports that you can always find in the news calendar can seriously influence the trajectory of a currency pair. Therefore, at the time of their release, we recommended trading as carefully as possible or exit the market in order to avoid a sharp price reversal.
Beginners on Forex should remember that not every single trade has to be profitable. The development of a clear strategy and money management are the key to success in trading over a long period of time.
