Analysis of transactions in the GBP / USD pair
GBP/USD tested 1.1980. At that time, the MACD line had just started to move above zero, which is a good signal to buy. Without a doubt, taking long positions was correct because the pair rose in price by more than 60 pips. It reached the resistance level of 1.2039, where sellers became active, leading to a 10-pip decrease. Then, demand returned, which caused pound to grow again. No other signals appeared for the rest of the day.
Although the report on UK industrial orders plummeted, demand for pound remained strong because political reshuffles in the country continue to affect the minds of speculative traders. Most likely, this upward movement will persist as data on UK retail sales will not affect the market, leaving pound with chances for further recovery and an upward correction. In the afternoon, the US will post the data on consumer confidence and volume of home sales in the primary market, which may put pressure on dollar, provided that they are much worse than expected. The Richmond Fed manufacturing index and the housing price index, meanwhile, will not affect the market because they are of little interest.
For long positions:
Buy pound when the quote reaches 1.2076 (green line on the chart) and take profit at the price of 1.2116 (thicker green line on the chart). There is a chance for a rally today, but only if the pair stays above 1.2045.
Take note that when buying, the MACD line should be above zero or is starting to rise from it. It is also possible to buy at 1.2045, but the MACD line should be in the oversold area as only by that will the market reverse to 1.2076 and 1.2116.
For short positions:
Sell pound when the quote reaches 1.2045 (red line on the chart) and take profit at the price of 1.1999. Pressure will return if bullish activity remains weak in the market and if talks about the further aggressive policy of the Federal Reserve increases further.
Take note that when selling, the MACD line should be below zero or is starting to move down from it. Pound can also be sold at 1.2076, but the MACD line should be in the overbought area, as only by that will the market reverse to 1.2045 and 1.1999.
What's on the chart:
The thin green line is the key level at which you can place long positions in the GBP/USD pair.
The thick green line is the target price, since the quote is unlikely to move above this level.
The thin red line is the level at which you can place short positions in the GBP/USD pair.
The thick red line is the target price, since the quote is unlikely to move below this level.
MACD line - when entering the market, it is important to be guided by the overbought and oversold zones.
Important: Novice traders need to be very careful when making decisions about entering the market. Before the release of important reports, it is best to stay out of the market to avoid being caught in sharp fluctuations in the rate. If you decide to trade during the release of news, then always place stop orders to minimize losses. Without placing stop orders, you can very quickly lose your entire deposit, especially if you do not use money management and trade large volumes.
And remember that for successful trading, you need to have a clear trading plan. Spontaneous trading decision based on the current market situation is an inherently losing strategy for an intraday trader.