Overview of yesterday's trading and tips on GBP/USD
The test of 1.2475 in the afternoon came at the time when the MACD indicator was just beginning to move down from the zero mark, which confirmed the correct entry point to sell the pound, especially after strong retail sales data from the US. The news that retail sales in the US nearly doubled in March, after a modest rise in February, was a catalyst for the pound falling and the US dollar strengthening. This morning, important reports are being released on the number of applications for unemployment benefits in the UK and the unemployment rate. However, data on average earnings in the UK will have much greater weight. Lower earnings will affect spending, thus bringing inflation down in the medium term, which will put pressure on the pound sterling in the short term. As for the intraday strategy, I will rely more on the implementation of scenarios No. 1 and No. 2.
Buy signal
Scenario No. 1. I plan to buy the pound sterling today when GBP/USD reaches the entry point around 1.2455 plotted by the green line on the chart, aiming for growth to 1.2499 plotted by the thicker green line on the chart. In the area of 1.2499, I'm going to close long positions and open short ones in the opposite direction (expecting a movement of 30-35 pips in the opposite direction from the level). You can count on the growth of the British pound today only after strong statistics for the UK, but it is better to act as low as possible and not count on strong pullbacks. Important! Before buying, make sure that the MACD indicator is above the zero mark and is just starting to rise from it.
Scenario No. 2. I also plan to buy the pound today in case of two consecutive tests of the price of 1.2409 at the time when the MACD indicator is in the oversold area. This will limit the downward potential of GBP/USD and lead to a reverse upward reversal of the market. We can expect growth to the opposite levels of 1.2455 and 1.2499.
Sell signal
Scenario No. 1. I plan to sell the pound today after the level of 1.2409 is updated (the red line on the chart), which will lead to a rapid decline in GBP/USD. The key target for sellers will be 1.2358, where I am going to close sell positions and also immediately open buy positions in the opposite direction (expecting a movement of 20-25 pips in the upward direction from that level). You can sell the pound while the downward trend continues, especially after an unsuccessful attempt to grow in the first half of the day. Important! Before selling, make sure that the MACD indicator is below the zero mark and is just starting to decline from it.
Scenario No. 2: I also plan to sell the pound today in case of two consecutive tests of 1.2455 at the time when the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a downward market reversal. We can expect a decline to the opposite level of 1.2409 and 1.2358.
What's on the chart:
The thin green line is the entry price at which you can buy the trading instrument.
The thick green line is the price where you can set Take-Profit (TP) or manually fix profits, as further growth above this level is unlikely.
The thin red line is the entry price at which you can sell the trading instrument.
The thick red line is the 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 in the cryptocurrency market need to be very cautious when making decisions to enter the market. It is best to stay out of the market before important fundamental reports are released to avoid getting caught in sharp price fluctuations. If you decide to trade during news releases, always place stop orders to minimize losses. Without setting stop orders, you can quickly lose your entire deposit, especially if you don't use money management and trade with large volumes.
Remember, for successful trading, it is necessary to have a clear trading plan, similar to the one I presented above. Spontaneously making trading decisions based on the current market situation is inherently a losing strategy for an intraday trader.
