06.08.202410:07 Forex Analysis & Reviews: GBP/USD: simple trading tips for beginners for the European session on August 6

Analysis of trades and tips on on GBP/USD

The price test of 1.2766 occurred when the MACD indicator was coming out of bearish territory, confirming the correct entry point for buying the pound within the channel and the high volatility observed in the first half of the day. As a result, GBP/USD rose about 40 pips. Strong UK Services PMI data convinced traders to buy the pound. However, each time it returned to the area of the day's high, sellers actively re-entered the market, ultimately locking the pair in a horizontal channel where the pair is currently trading. Today, volatility will likely decrease, but I plan to continue trading within the channel, trying to find more suitable entry points for selling—especially in case of weak UK construction data. As for the intraday strategy, I will focus more on implementing scenario No. 2.

Buy signals

Scenario No 1. Today, I plan to buy the pound when the price reaches the entry point at 1.2789, plotted by the green line on the chart, with the goal of rising to 1.2838, plotted by the thicker green line on the chart. In the area of 1.2838, 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 can only count on a strong pound growth in the first half of the day after good data. 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 1.2735 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 1.2789 and 1.2838.

Sell signals

Scenario No 1. Today, I plan to sell the pound after testing the level of 1.2735 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 1.2689, 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 unsuccesful after the release of PMI data in the development of the downtrend. 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 1.2789 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 1.2735 and 1.2689.

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.