Overview of trading and tips on GBP/USD
The price test of 1.2648 occurred when the MACD indicator was just starting to rise from the zero mark, which confirmed the correct entry point to buy the pound. As a result, GBP/USD rose by almost 20 pips. I mentioned this in yesterday's forecast as it was forming at the time of writing. Today, the UK will release reports on the GDP and the current account. Positive growth in the UK economy will benefit the pound, which is already quite oversold. Yesterday, the Bank of England's minutes and BoE Governor Andrew Bailey's statements did not put pressure on the pound. Therefore, the British currency has the chance to recover by the end of the month. As for the intraday strategy, I will rely more on the implementation of scenarios No. 1 and 2.
Buy signals
Scenario No 1. Today, I plan to buy the pound when the price reaches the entry point at 1.2648 plotted by the green line on the chart, aiming for a rise to the level of 1.2680 plotted by the thicker green line on the chart. Around 1.2680, I plan to exit the long positions and sell the pound in the opposite direction, counting on a movement of 30-35 pips from the entry point. You can count on the pound to rise today, but only after strong data. 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 at 1.2617 when the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to a reverse market upturn. One can expect growth to the opposite levels of 1.2648 and 1.2680.
Sell signals
Scenario No 1. Today, I plan to sell the pound after testing the level of 1.2617 plotted by the red line on the chart, which will lead to a rapid decline in GBP/USD. The key target for sellers will be 1.2586, where I am going to close short positions and also open long positions in the opposite direction (expecting a movement of 20-25 pips in the opposite direction from that level). You can sell the pound after weak data in continuation of the trend. 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 price tests of 1.2648 when the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a reverse market downturn. One can expect a decline to the opposite levels of 1.2617 and 1.2586.
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 estimated price where you can set Take-Profit (TP) or manually close positions, 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 close positions, 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 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 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 in large volumes.
And 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.
