Analysis of transactions and tips for trading GBP/USD
Further growth became limited because the first test of 1.2540 occurred when the MACD line moved upward quite sharply from zero. Sometime later, another test took place, and this time the MACD line lay within the overbought area, sparking a sell signal. However, a significant price decrease did not materialize in the pair.
The remarks of Bank of England representatives did not help pound reach the monthly highs, while the Fed's minutes of the meeting put further pressure on the pair. After all, traders found nothing indicating the end of the rate hike cycle not a reduction in the coming year.
Today, there will be a report on the UK's industrial order, followed by a forecast from the HM Treasury. It may lead to a similar scenario as yesterday's, as it may not assist pound in recovering its position.
For long positions:
Buy when pound hits 1.2546 (green line on the chart) and take profit at the price of 1.2580 (thicker green line on the chart). Growth will occur as long as traders protect the local low.
When buying, ensure that the MACD line lies above zero or just starts to rise from it. Pound can also be bought after two consecutive price tests of 1.2510, but the MACD line should be in the oversold area as only by that will the market reverse to 1.2546 and 1.2580.
For short positions:
Sell when pound reaches 1.2510 (red line on the chart) and take profit at the price of 1.2486. Pressure will return in the absence of activity at the daily high.
When selling, ensure that the MACD line lies below zero or drops down from it. Pound can also be sold after two consecutive price tests of 1.2546, but the MACD line should be in the overbought area as only by that will the market reverse to 1.2510 and 1.2470.
What's on the chart:
Thin green line - entry price at which you can buy GBP/USD
Thick green line - estimated price where you can set Take-Profit (TP) or manually fix profits, as further growth above this level is unlikely.
Thin red line - entry price at which you can sell GBP/USD
Thick red line - estimated price where you can set Take-Profit (TP) or manually fix profits, as further decline below this level is unlikely.
MACD line- it is important to be guided by overbought and oversold areas when entering the market
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.
