Trade Analysis and Tips for Trading the British Pound

The price test at 1.3321 occurred when the MACD indicator had risen significantly above the zero mark, limiting the pair's upward potential. Considering how the pair reacted to the PMI data for the services and manufacturing sectors, it's easy to understand why I didn't buy the pound against the intraday downtrend. Unfortunately, the U.S. data was disappointing, leading to a rise in the pound in the afternoon. During European trading, there is no economic data from the UK, so GBP/USD may continue to rise, following the upward trend observed since the beginning of September. As for the intraday strategy, I will focus more on implementing scenarios No. 1 and 2 to continue strengthening the GBP.

Buy Signal

Scenario No 1: I plan to buy the pound today when it reaches the entry point around 1.3369 (green line on the chart) with a target for growth to the level of 1.3435 (thicker green line on the chart). Around 1.3435, I intend to exit my long positions and open sell positions in the opposite direction (aiming for a 30-35 pips movement from that level). The pound can continue to rise, reflecting bullish sentiment. Important! Before buying, ensure that the MACD indicator is above the zero mark and starting to rise.

Scenario No 2: I also plan to buy the pound today if the price at 1.3329 is tested twice consecutively when the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to an upward reversal. Growth can be expected toward the opposing levels of 1.3369 and 1.3435.

Sell Signal

Scenario No 1: Today, I plan to sell the pound after testing the 1.3329 level (red line on the chart), which will lead to a quick decline in the pair. The key target for sellers will be the level of 1.3254, where I intend to exit my sell positions and open longs immediately in the opposite direction (aiming for a movement of 20-25 pips from that level). The pound can be sold after a failed attempt to consolidate near the daily high. Important! Before selling, ensure that the MACD indicator is below the zero mark and starting to decline.

Scenario No 2: I also plan to sell the pound today if the price at 1.3369 is tested twice consecutively when the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a reversal downward. A decline can be expected toward the opposing levels of 1.3329 and 1.3254.

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 secure profits, 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 set Take Profit or manually secure profits, 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 very cautious when deciding to enter the market. It is best to stay out of the market before important fundamental reports are released to avoid sharp price fluctuations. If you choose to trade during news releases, always set 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.

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.