Analysis of transactions and tips for trading GBP/USD
The test of 1.2013 occurred when the MACD line was just starting to move below zero, which was a pretty good signal to sell. However, the decline was only brief as the pair rose again and updated 1.2051. This time, the MACD had just started to move above zero, which was a good signal to buy. Resultantly, the pair gained as much as 50 pips. Selling on the rebound from 1.2093 led to losses.
GBP/USD saw gains on Tuesday, thanks to the strong PMI data on the UK. However, the increase was halted in the afternoon as similar and quite good reports in the US prompted a rise in dollar demand. Nevertheless, there are no UK statistics scheduled to be released today, so market players have all chances to continue the bullish scenario. The Fed's minutes is also the only important thing in the afternoon, and it is unlikely to have any strong impact as much has already changed since the FOMC meeting.
For long positions:
Buy pound when the quote reaches 1.2119 (green line on the chart) and take profit at the price of 1.2170 (thicker green line on the chart). Growth will be possible as there is a new bullish trend. However, when buying, make sure that the MACD line is above zero or is starting to rise from it. Pound can be bought at 1.2079, but the MACD line should be in the oversold area as only by that will the market reverse to 1.2119 and 1.2170.
For short positions:
Sell pound when the quote reaches 1.2079 (red line on the chart) and take profit at the price of 1.2035. Pressure will return if there is no activity at the weekly highs. However, when selling, make sure that the MACD line is below zero or is starting to move down from it. Pound can also be sold at 1.2119, but the MACD line should be in the overbought area as only by that will the market reverse to 1.2079 and 1.2035.
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.
