Trade analysis and trading tips for the British pound
The test of the price at 1.2540 in the first half occurred when the MACD indicator was starting to move upward from the zero mark, confirming the correct entry point for buying the pound. As a result, the pair only rose by 15 points, and that was the end of it. Lending data did not affect market sentiment in any way. Something may change after today's consumer confidence indicators in the US and the Chicago PMI index. However, the reports must exceed economists' expectations for the pound to react seriously. If not, it's better to trade within the range. As for the intraday strategy, I will rely more on scenarios #1 and #2.
Buy Signal
Scenario #1: Today, I plan to buy the pound when the entry point reaches around 1.2558 (green line on the chart), with the target of rising to the level of 1.2590 (thicker green line on the chart). At the point of 1.2590, I will exit purchases and open sales in the opposite direction (expecting a movement of 30-35 points in the opposite direction from the level). Pound growth today can only be expected after weak statistics and after breaking the daily maximum. Important! Before buying, make sure that the MACD indicator is above the zero mark and is just starting to rise from it.
Scenario #2: I also plan to buy the pound today in case of two consecutive tests of the price at 1.2532 when the MACD indicator is in the oversold zone. This will limit the downward potential of the pair and lead to a reverse market turnaround upwards. It is possible to expect growth to the opposite levels of 1.2558 and 1.2590.
Sell Signal
Scenario #1: I plan to sell the pound today after updating the level of 1.2532 (red line on the chart), which will lead to a rapid decline in the pair. The key target for sellers will be the level of 1.2486, where I will exit sales and also open purchases immediately in the opposite direction (expecting a movement of 20-25 points in the opposite direction from the level). Sellers will show themselves in case of a lack of activity around the daily maximum and strong US data. Important! Before selling, make sure that the MACD indicator is below the zero mark and is just starting to decline from it.
Scenario #2: I also plan to sell the pound today in case of two consecutive tests of the price at 1.2558 when the MACD indicator is in the overbought zone. This will limit the upward potential of the pair and lead to a reverse market turnaround downwards. It is possible to expect a decrease to the opposite levels of 1.2532 and 1.2486.
What's on the chart:
Thin green line - entry price, at which the trading instrument can be bought.
Thick green line - the assumed price where you can set Take Profit or independently fix profits, as further growth above this level is unlikely.
Thin red line - entry price at which the trading instrument can be sold.
Thick red line - the assumed price where you can set Take Profit or independently fix profits, as further decline below this level is unlikely.
MACD indicator. When entering the market, it is important to guide yourself by overbought and oversold zones.
Important. Beginner traders in the forex market need to be very careful when making decisions to enter the market. It is best to stay out of the market before important fundamental reports are released to avoid being caught in sharp exchange rate fluctuations. If you decide to trade during news releases, always place stop orders to minimize losses. You need to place stop orders to quickly lose your entire deposit, especially if you do not use money management and trade in large volumes.
And remember, for successful trading, it is necessary to have a clear trading plan similar to the one presented above. Spontaneous decision-making based on the current market situation is initially a losing strategy for an intraday trader.
