Analysis of transactions in the GBP / USD pair
Bullish traders did a lot to regain control of the market. To begin with, during the test of 1.3441, they took long positions as the MACD line was at the oversold area. This led to a more than 30 pips increase in the pair. Afterwards, 1.3467 was tested, but this time the MACD line was far away from zero. They had no choice but to ignore the buy signal.
Selling at 1.3507 led to losses because GBP / USD continued to grow despite the MACD line holding up at the overbought area.
Talking about statistics, manufacturing activity in the UK remained at a fairly good level in September, increasing demand for pound. Then, it surprisingly grew even more, despite strong data on US consumer sentiment.
The lack of UK data this morning plays on the side of the bulls. Therefore, it is likely that GBP / USD will climb higher, especially in the context of weakening fuel crisis. In the afternoon, there will be a report on the volume of US industrial orders, but it is unlikely to shake the markets.
For long positions:
Open a long position when pound reaches 1.3556 (green line on the chart) and take profit at 1.3605 (thicker green line on the chart). The upward correction, which was seen last week, may continue today. But before buying, make sure that the MACD line is above zero, or is starting to rise from it.
It is also possible to buy at 1.3527, but the MACD line should be in the oversold area, as only by that will the market reverse to 1.3556 and 1.3605.
For short positions:
Open a short position when pound reaches 1.3527 (red line on the chart) and take profit at 1.3474. Pressure will return if buyers remain inactive around 1.3527. But before selling, make sure that the MACD line is below zero, or is starting to move down from it.
The pair could also be sold at 1.3556, but the MACD line should be in the overbought area, as only by that will the market reverse to 1.3527 and 1.3474.
What's on the chart:
The thin green line is the key level at which you can place long positions in the GBP/USD pair.
The thick green line is the target price, since the quote is unlikely to move above this level.
The thin red line is the level at which you can place short positions in the GBP/USD pair.
The thick red line is the target price, since the quote is unlikely to move below this level.
MACD line - when entering the market, it is important to be guided by the overbought and oversold zones.
Important: Novice traders need to be very careful when making decisions about entering the market. Before the release of important reports, it is best to stay out of the market to avoid being caught in sharp fluctuations in the rate. If you decide to trade during the release of news, then always place stop orders to minimize losses. Without placing 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 for successful trading, you need to have a clear trading plan. Spontaneous trading decisions based on the current market situation is an inherently losing strategy for an intraday trader.
