Analysis of Trades and Trading Tips for the British Pound
The first test of the 1.2797 price level occurred when the MACD was significantly above the zero mark, limiting the pair's further upward potential. The second test of this level shortly after that found the MACD in the overbought area, allowing Scenario No. 2 for selling to unfold, resulting in a 15-point drop in the pair. A series of reports on changes in non-farm payrolls for May, the unemployment rate, and changes in average hourly earnings are scheduled. A drop in new jobs and a sharp slowdown in wage growth will lead to a decline in the dollar and a sharp strengthening of the pound. Otherwise, it is better to buy the dollar and bet on a decline in the pair by the end of the week. Regarding the intraday strategy, I plan to act based on the implementation of Scenario No. 1, ignoring the MACD indicator readings.
Buy Signal
Scenario No. 1: Today, I plan to buy the pound upon reaching the entry point around 1.2808 (green line on the chart) with the target of rising to the level of 1.2847 (thicker green line on the chart). Around 1.2847, I will exit purchases and open sales in the opposite direction (expecting a 30-35 pip move from the level). The pound's growth today can be expected only in the case of very weak US statistics. Important! Before buying, make sure the MACD indicator is above the zero mark and 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 1.2789 price when the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to a market reversal upwards. Growth to the opposite levels of 1.2808 and 1.2847 can be expected.
Sell Signal
Scenario No. 1: Today, I plan to sell the pound after updating the 1.2789 level (red line on the chart), which will lead to a quick decline in the pair. The key target for sellers will be the 1.2755 level, where I will exit sales and open purchases immediately in the opposite direction (expecting a 20-25 pip move from the level). Sellers will show their strength in case of strong US data. Important! Before selling, make sure the MACD indicator is below the zero mark and just starting to fall from it.
Scenario No. 2: I also plan to sell the pound today in case of two consecutive tests of the 1.2808 price when the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a market reversal downwards. A decline to the opposite levels of 1.2789 and 1.2755 can be expected.
Chart Explanation:
- Thin Green Line: Entry price at which you can buy the trading instrument.
- Thick Green Line: Estimated 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 you can sell the trading instrument.
- Thick Red Line: Estimated 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 be guided by overbought and oversold zones.
Important: Beginner forex traders should be very cautious when making market entry decisions. It is best to stay out of the market before the release of important fundamental reports to avoid getting caught in sharp price swings. If you decide to trade during news releases, always set stop orders to minimize losses. Without stop orders, you can quickly lose your entire deposit, especially if you don't use money management and trade large volumes.
And remember, successful trading requires a clear trading plan, like the one presented above. Spontaneous trading decisions based on the current market situation are inherently a losing strategy for an intraday trader.
