Analysis of transactions in the GBP / USD pair
The test of 1.1340 occurred at the time when the MACD line just starting to move up from zero, which was a good reason to buy. This led to a price increase of more than 50 pips. However, the upward movement was so rapid that after hitting 1.1395, no downward correction took place. That was why selling on a rebound from the level led to losses.
The speech of Bank of England member Huw Pill did not affect pound, however, the initiatives proposed by the new UK Prime Minister to resolve problems with the country's budget, as well as the weakness of dollar after last week's labor market data, pushed GBP/USD up.
There are no important statistics scheduled to be released in the UK today, which theoretically should help pound to make an attempt to return to the region of monthly highs. However, it appears that a decline may occur some time today. In the afternoon, FOMC member Loretta Mester is expected to speak, followed by the NFIB's report on small business optimism. The latter is unlikely to support dollar, so the pair will trade within the side channel.
For long positions:
Buy pound when the quote reaches 1.1513 (green line on the chart) and take profit at the price of 1.1558 (thicker green line on the chart). But growth is unlikely to occur today, so be careful when taking long positions. Also, remember that when buying, the MACD line should be above zero or is starting to rise from it.
Pound can also be bought at 1.1464, however, the MACD line should be in the oversold area as only by that will the market reverse to 1.1513 and 1.1585.
For short positions:
Sell pound when the quote reaches 1.1464 (red line on the chart) and take profit at the price of 1.1394. Pressure will return in the event of hawkish statements from the Fed. But 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 1.1513, however, the MACD line should be in the overbought area as only by that will the market reverse to 1.1464 and 1.1394.
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.
