27.12.202415:06 Forex Analysis & Reviews: GBP/USD: Simple Trading Tips for Beginner Traders on December 27th (U.S. Session)

Analysis of Trades and Tips for Trading the British Pound

The test of the 1.2514 level coincided with the moment when the MACD indicator moved significantly below the zero mark, limiting the pair's downward potential. A similar scenario occurred at the 1.2532 level, so no trades were executed.

In the second half of the day, U.S. statistics may trigger volatility, and only strong data on the goods trade balance and wholesale inventory changes could put pressure on the pound. Otherwise, the pair may continue its upward correction. If trade balance data reveals a growing deficit, this could weaken the dollar, supporting the British pound. Conversely, if the data shows improvement, especially in exports, competition in the forex market will intensify. It's also worth noting that changes in wholesale inventory levels are a crucial indicator of economic activity. An increase in inventory may signal weak consumption, which negatively impacts economic prospects.

Buy Signal

Scenario #1: I plan to buy the pound today upon reaching the 1.2570 level (green line on the chart), targeting 1.2600 (thicker green line on the chart). Around 1.2600, I plan to exit purchases and open sell positions in the opposite direction, aiming for a 30-35 point move. Pound growth today is likely to occur within the channel.Important! Before buying, ensure that the MACD indicator is above the zero mark and is just beginning to rise from it.

Scenario #2: I also plan to buy the pound today if there are two consecutive tests of the 1.2547 level while the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to a market reversal upward. Growth can be expected toward the 1.2570 and 1.2600 levels.

Sell Signal

Scenario #1: I plan to sell the pound today after the 1.2547 level is breached (red line on the chart), which should lead to a sharp decline in the pair. The key target for sellers will be the 1.2508 level, where I plan to exit sales and open buy positions immediately in the opposite direction, aiming for a 20-25 point move. Sellers are unlikely to be very active today.Important! Before selling, ensure that the MACD indicator is below the zero mark and is just beginning to decline from it.

Scenario #2: I also plan to sell the pound today if there are two consecutive tests of the 1.2570 level while the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a market reversal downward. Declines can be expected toward the 1.2547 and 1.2508 levels.

Chart Details:

• Thin Green Line: Entry price for buying the trading instrument.
• Thick Green Line: Projected price for setting Take Profit or locking in profits manually, as further growth beyond this level is unlikely.
• Thin Red Line: Entry price for selling the trading instrument.
• Thick Red Line: Projected price for setting Take Profit or locking in profits manually, as further declines beyond this level are unlikely.
• MACD Indicator: It is crucial to monitor overbought and oversold zones when entering the market.

Important Notes for Beginner Traders:

Forex market beginners must make cautious decisions when entering the market. It is best to avoid trading before the release of significant fundamental reports to prevent sharp price fluctuations. If you decide to trade during news releases, always set stop-loss orders to minimize losses. Without stop-loss orders, you could quickly lose your entire deposit, especially when trading large volumes without proper money management.

Remember, successful trading requires a clear plan, such as the one outlined above. Making impulsive trading decisions based on current market conditions is inherently a losing strategy for intraday traders.