Analysis of transactions in the GBP / USD pair
A signal to sell emerged after GBP/USD hit 1.3055. However, there was no sharp decrease because the MACD line being far from zero limited the downside potential of the pair. No other signal appeared for the rest of the day.
The report on US industrial production did not provoke a rally in dollar last Friday, even though the data came out much better than expected.
But today, there may be another decline in GBP/USD because there are no UK statistics scheduled to be published. And in the afternoon, trading volume is likely to remain low because the NAHB housing market index is not that important for the market. There will also be a speech from FOMC member James Bullard, who will surely talk about the future policy of the Fed. That could play on the side of dollar bulls, which will lead to a fall in the pair.
For long positions:
Buy pound when the quote reaches 1.3041 (green line on the chart) and take profit at the price of 1.3080 (thicker green line on the chart). However, there is little chance for a rally today because there are no drivers for growth yet. In any case, when buying, make sure that the MACD line is above zero, or is starting to rise from it. It is also possible to buy at 1.3017, but the MACD line should be in the oversold area as only by that will the market reverse to 1.3041 and 1.3080.
For short positions:
Sell pound when the quote reaches 1.3017 (red line on the chart) and take profit at the price of 1.2988. Pressure is likely to return on the market, and that will lead to the GBP/USD's decline below buy stop orders. However, before selling, make sure that the MACD line is below zero, or is starting to move down from it. Pound can also be sold at 1.3041, but the MACD line should be in the overbought area, as only by that will the market reverse to 1.3017 and 1.2988.
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.
