Trade Analysis and Tips for Trading the British Pound

The price test at 1.2621 occurred as the MACD indicator began moving downward from the zero line, confirming a valid entry point for selling the pound in line with the downtrend. However, as shown on the chart, the pair did not experience a significant drop. Significant price movements in the second half of the day are also unlikely. The only notable economic events are the NAHB Housing Market Index, which holds little interest for traders, and a speech by FOMC member Austin D. Goolsbee, which is unlikely to reveal new information. Given this, it's prudent to trade within the established price channel. For intraday strategies, I will prioritize implementing Scenarios #1 and #2.

Buy Signal

• Scenario #1: I plan to buy the pound today if the price reaches 1.2637 (green line on the chart), targeting a rise to 1.2659 (thicker green line on the chart). At 1.2659, I will exit the market and then sell the pound in the opposite direction, aiming for a move of 30-35 points. Strong growth for the pound today appears unlikely. Important: Before buying, ensure the MACD indicator is above the zero line and beginning to move upward.
• Scenario #2: I also plan to buy the pound today if the price tests 1.2613 twice consecutively and the MACD indicator is in the oversold area. This would limit the pair's downward potential and trigger a reversal. Targets are set at 1.2637 and 1.2659.

Sell Signal

• Scenario #1: I plan to sell the pound today if the price updates to 1.2613 (red line on the chart), which will likely result in a sharp decline. The primary target for sellers will be 1.2585, where I will exit the position and immediately buy in the opposite direction, targeting a 20-25 point upward move. Sellers are expected to dominate within the prevailing downtrend. Important: Before selling, ensure the MACD indicator is below the zero line and starting to decline.
• Scenario #2: I also plan to sell the pound today if the price tests 1.2637 twice consecutively and the MACD indicator is in the overbought area. This would limit the pair's upward potential and trigger a reversal. Targets are set at 1.2613 and 1.2585.

What's on the Chart

• Thin Green Line: Entry price for buying the trading instrument.
• Thick Green Line: Target price for setting Take Profit or manually taking profits, as further growth beyond this level is unlikely.
• Thin Red Line: Entry price for selling the trading instrument.
• Thick Red Line: Target price for setting Take Profit or manually taking profits, as further decline beyond this level is unlikely.
• MACD Indicator: Focus on the overbought and oversold zones when making market entries.

Important Notes for Beginner Traders

Beginner traders should exercise caution when entering the market. It is advisable to stay out of the market before significant fundamental reports are released to avoid sharp price fluctuations. If you choose to trade during news releases, always set stop-loss orders to minimize losses. Without stop-losses, you risk losing your entire deposit, particularly if trading large positions without proper money management.

For successful trading, a clear and structured trading plan is essential, as demonstrated above. Spontaneous trading decisions based on current market conditions often lead to losses for intraday traders.