Overview of trading and tips on GBP/USD
The price test of 1.2829 occurred when the MACD indicator started to move down from the zero mark, confirming the correct entry point for selling the pound according to the trend. Unfortunately, although GBP/USD fell during the day, it did not lead to a new decline. Then, there was a price test of 1.2849, coinciding with the start of the MACD's rise from the zero mark, which produced a signal to buy the pound. As a result, the pair rose 15 pips, offsetting losses from the first trade. Yesterday, UK reports on the M4 money supply and mortgage approvals did not affect the pair's movements. Today, the UK economic calendar is empty, so buyers may have a chance to support the upward trend, but only within the horizontal channel. Remember that it is better to trade with the trend, and the medium-term direction for the pound is downward. As for the intraday strategy, I will rely more on realizing scenarios No. 1 and 2.
Buy signals
Scenario No 1. Today, I plan to buy the pound when the price reaches the entry point around 1.2868, plotted by the green line on the chart, with the goal of rising to 1.2905, plotted by the thicker green line on the chart. Around 1.2905, I plan to exit long positions and sell the pound in the opposite direction, counting on a movement of 30-35 pips from the level. We don't expect a solid rise in the pound today in the first half of the day. At most, we will see a minor correction and trading within the channel. Before buying, ensure 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 the price at 1.2843 is tested twice consecutively 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 1.2868 and 1.2905.
Sell signals
Scenario No 1. Today, I plan to sell the pound after testing the level of 1.2843 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 1.2811, where I will exit short positions and immediately 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 if buyers are not active near the intraday high. 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 1.2868 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 1.2843 and 1.2811.
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.
