Analysis of transactions in the GBP / USD pair
When GBP/USD tested 1.2225, the MACD line was far from zero, so the upside potential was limited. Sometime later, the pair tested the level again, but this time the MACD line was gradually declining, which was a good signal to sell. This prompted a price decrease of around 30 pips. In the afternoon, there was a test of 1.2225, during which the MACD line showed a good entry point to buy the pound. In turn, the quote grew by more than 30 pips.
Although the data on UK house prices did not help pound rise, GBP/USD rallied because the report on US producer prices showed a sharp decline. The quote, however, did not hit a new weekly high.
Ahead are important indicators for the UK economy, namely the GDP, industrial production and trade balance. If the figures exceed expectations, the pair will certainly grow, albeit just slightly. In the afternoon, the US will publish data on consumer expectations and consumer sentiment from the University of Michigan, but it is unlikely to help dollar much. Export price index and import price index reports will also be of little interest.
For long positions:
Buy pound when the quote reaches 1.2208 (green line on the chart) and take profit at the price of 1.2245 (thicker green line on the chart). However, there is little chance for a rally today, especially in the case of weak reports on the UK economy.
Take note that when buying, the MACD line should be above zero or is starting to rise from it. It is also possible to buy at 1.2061, but the MACD line should be in the oversold area as only by that will the market reverse to 1.2085 and 1.2125.
For short positions:
Sell pound when the quote reaches 1.2181 (red line on the chart) and take profit at the price of 1.2140. Pressure will increase if the UK reports weak statistics and buying pressure decreases around 1.2180.
Take note that when selling, the MACD line should be below zero or is starting to move down from it. Pound can also be sold at 1.2208, but the MACD line should be in the overbought area, as only by that will the market reverse to 1.2181 and 1.2140.
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 decision based on the current market situation is an inherently losing strategy for an intraday trader.
