Analysis of Trades and Trading Tips for the British Pound
The test of the 1.3079 level took place when the MACD indicator had already moved significantly downward from the zero mark, limiting the pound's downward potential. For this reason, I did not sell. No other tests of the levels took place. The absence of economic data from the UK made its impact, allowing sellers to achieve only a new weekly low but unable to hold below it. In the second half of the day, we are expecting the minutes from the Federal Reserve's September meeting and speeches from several FOMC members. The statements from policymakers will be crucial in determining intraday market volatility. Regarding the intraday strategy, I plan to act according to the implementation of scenarios #1 and #2.
Buy Signal
Scenario #1: Today, I plan to buy the pound upon reaching the entry point around 1.3095 (green line on the chart), targeting a rise to the 1.3120 level (thicker green line on the chart). At the 1.3120 level, I will exit my purchases and open sales in the opposite direction (targeting a 30-35 point movement in the opposite direction from the level). A rise in the pound today can be expected after a dovish tone from the policymakers. It is important to ensure that the MACD indicator is above the zero mark and just starting to rise from it before buying.
Scenario #2: I also plan to buy the pound today in case of two consecutive tests of the 1.3079 level when the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to an upward market reversal. A rise towards the opposing levels of 1.3095 and 1.3120 can be expected.
Sell Signal
Scenario #1: Today, I plan to sell the pound after breaking below the 1.3079 level (red line on the chart), which will lead to a rapid decline in the pair. The key target for sellers will be the 1.3059 level, where I will exit sales and open immediate purchases in the opposite direction (targeting a 20-25 point movement in the opposite direction from the level). Sellers will make their presence known if the Federal Reserve adopts a cautious stance. It is important to ensure that the MACD indicator is below the zero mark and just starting to decline from it before selling.
Scenario #2: I also plan to sell the pound today in case of two consecutive tests of the 1.3095 level when the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a downward market reversal. A decline towards the opposing levels of 1.3079 and 1.3059 can be expected.
What's on the chart:
- Thin green line – the entry price for buying the trading instrument.
- Thick green line – the suggested price for setting a take profit or manually fixing profits, as further growth beyond this level is unlikely.
- Thin red line – the entry price for selling the trading instrument.
- Thick red line – the suggested price for setting a take profit or manually fixing profits, as further declines beyond this level are unlikely.
- MACD Indicator: When entering the market, it's important to use the MACD indicator's overbought and oversold areas as a guide.
Important: Beginner traders in the forex market should make market entry decisions very cautiously. It is best to stay out of the market before the release of important fundamental reports to avoid sharp price fluctuations. If you decide to trade during news releases, always set stop orders to minimize losses. Without setting stop orders, you could quickly lose your entire deposit, especially if you don't use risk management and trade with large volumes.
And remember, for successful trading, you need a clear trading plan, like the one I have provided above. Making spontaneous trading decisions based on the current market situation is a losing strategy for an intraday trader.
