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Analysis of trades and tips on on GBP/USD
The price test of 1.2837 occurred when the MACD indicator started moving downward from the zero mark, confirming the correct entry point for selling the pound. As a result, the GBP/USD pair dropped to the 1.2802 area. I bought immediately on the rebound from there, which brought about another 30 pips of profit. Like other risky assets, the pound reacted to the strong U.S. retail sales data with a drop, but the decline was quickly bought back, as the good UK GDP data released in the first half of the day was still fresh in traders' minds. Today, we are waiting for the U.K. retail sales report, including fuel costs, and good indicators will likely continue to support the pound, allowing it to break through and test the weekly high. However, whether buyers will remain active there is a tough question. Remember, today is the end of the week, and each test of the local high has been challenging for buyers. Today might be the right time for a correction – we'll see. As for the intraday strategy, I will rely more on the implementation of scenarios No. 1 and No. 2.
Buy signals
Scenario No 1. Today, I plan to buy the pound when the price reaches the entry point in the area of 1.2896, plotted by the green line on the chart, with the goal of rising to 1.2930, plotted by the thicker green line on the chart. In the area of 1.2930, 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. You can count on the pound's strong rise today after good news in the UK. Important: Before buying, ensure the MACD indicator is above the zero mark and starting to rise from it.
Scenario No 2. I also plan to buy the pound today if the price at 1.2869 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 1.2896 and 1.2930.
Sell signals
Scenario No 1. Today, I plan to sell the pound after testing 1.2896, 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 1.2832, 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 fail near the intraday high or weak data. Important: 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 1.2896 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 1.2869 and 1.2832.
What's on the chart:
Thin green line: the entry price at which you can buy the trading instrument.
Thick green line: the estimated price at which you can set Take Profit or manually close positions, as further growth above this level is unlikely.
Thin red line: the entry price at which you can sell the trading instrument.
Thick red line: an estimated price at which you can place Take Profit or manually close positions, as further decline below this level is unlikely.
MACD indicator: when entering the market, it is essential to be guided by overbought and oversold zones.
Important: Novice traders in the forex market must be cautious when deciding 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. You must set stop orders to avoid losing your entire deposit, especially if you don't use money management and trade in large volumes.
Remember, a clear trading plan, like the one I've outlined, is essential for successful trading. Making impulsive decisions based on the current market situation is a losing strategy for novice intraday traders.
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