05.07.202410:00 Forex Analysis & Reviews: GBP/USD: trading tips for beginners for the European session on July 5

Overview of trading and tips on GBP/USD

There were no price tests of the levels I mentioned in the U.S. session, so we did not get any good entry points. The absence of UK data and the U.S. Independence Day holiday were the main reasons why volatility was low. Today, the pound has risen to the area of the weekly high, but breaking and testing it will require good UK data, which might also pose problems. The UK's Halifax house price index is unlikely to play a significant role in determining the pair's direction, so it's better to save energy and wait for the U.S. labor market data. The pair will likely trade within the channel during the European session, which I plan to take advantage of. 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 1.2778 plotted by the green line on the chart, aiming for a rise to the level of 1.2806 plotted by the thicker green line on the chart. Around 1.2806, 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 level. You can count on the pound to rise today, but only after good data and a break above the weekly high. 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 1.2760 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 1.2778 and 1.2806.

Sell signals

Scenario No 1. Today, I plan to sell the pound after testing the level of 1.2760 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 1.2735, 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 disappointing data and if buyers are not active around the weekly 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 1.2778 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 1.2760 and 1.2735.

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.