Analysis of previous deals:
30M chart of the GBP/USD pair
The GBP/USD pair moved very weakly on the 30-minute timeframe on Wednesday. In principle, the nature of the movement is now very similar to the EUR/USD pair, which is trading in an absolute flat. The pound/dollar pair is also within the horizontal channel, limited by the levels of 1.3796 and 1.3887. Today there was a rebound from the level of 1.3796, but we will analyze this buy signal a little below, since a similar signal was generated on the 5-minute timeframe. There is no trend at the 30-minute TF at this time. Macroeconomic background has a weak impact on the pair's movement. At least a fairly important inflation report was published in the UK today. And the actual value of this report did not match the forecasts of the experts. Therefore, novice traders could count on the reaction of the markets. However, the pair's volatility remained weak. And where there is weak volatility, there are either false signals or the absence of any signals. Unfortunately, today was the first option.
5M chart of the GBP/USD pair
The movement was even more eloquent on the 5-minute timeframe. If a clear and strong buy signal was formed at the very beginning of the European trading session, then in the future we did not see any clear signal anymore. The rebound from the level of 1.3796 should have been traded with a long position. Subsequently, the pair bounced off the level of 1.3830. It took several hours. However, it was necessary to close longs in profit of about 10 points and open short positions here, although the sell signal was very inaccurate and could be ignored. Nevertheless, let's analyze the option in which the beginners still worked it out. A few hours later the price settled above the level of 1.3830, so short positions should have been closed. The loss was about 15 points. All subsequent signals near the level of 1.3830 should not have been worked out, since the pair began to move in a flat, and at that moment, at least two false signals had already been formed near the level of 1.3830. As a result, novice traders could end the day with either minimal profit or minimal loss.
How to trade on Thursday:
At this time, the pound/dollar pair is moving in absolute flat on the 30-minute timeframe, and even with little volatility. Therefore, we do not recommend considering signals from the MACD indicator at this time. It is necessary to wait for the formation of a trend, which will be supported by a trend line or channel. The important levels on the 5-minute timeframe are 1.3753, 1.3796, 1.3830, 1.3863, 1.3891. We recommend trading with them. The price can bounce off them or overcome them. As before, we set Take Profit at a distance of 40-50 points. At the 5M TF, you can use all the nearest levels as targets, but then you need to take profit, taking into account the strength of the movement. When passing 20 points in the right direction, we recommend setting Stop Loss to breakeven. There are no major publications or events scheduled for Thursday in the UK. Thus, novice traders will have to trade using pure technique tomorrow, and it will be possible to pay attention to the report on retail sales in the United States. There are few chances that a strong movement will begin after it, but it is still better than nothing.
We also recommend that you familiarize yourself with the EUR/USD review.
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.
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 speeches and reports (always contained in the news calendar) can greatly influence the movement of a currency pair. Therefore, during their exit, it is recommended to trade as carefully as possible or exit the market in order to avoid a sharp price reversal against the previous movement.
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.
