Analysis of transactions in the GBP / USD pair
The test of 1.1897 took place at a time when the MACD was far from zero, which limited the downside potential of the pair. Sometime later, another test happened, but this time the MACD line was just starting to move below zero, which was a good signal to sell. This resulted in a price decrease of more than 40 pips. Buying at 1.1848 did not bring much profit.
Although the retail sales data in the UK exceed expectations, GBP/USD fell because confidence decreased, keeping the pressure on the market. Reportedly, retail sales rose 0.3%, while consumer confidence dropped 3 points to minus 44 in August, the lowest level since 1974.
There are no important statistics scheduled to be released in the UK today, so expect volatility to be low in the markets. In the afternoon, apart from the National Activity Index of the Chicago Fed, there is also nothing interesting to look forward to, so expect GBP/USD to trade horizontally.
For long positions:
Buy pound when the quote reaches 1.1839 (green line on the chart) and take profit at the price of 1.1911 (thicker green line on the chart). Although there is little chance for a rally today, an upward correction could still happen after such a large decline last week.
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 1.1799, but the MACD line should be in the oversold area as only by that will the market reverse to 1.1839 and 1.1911.
For short positions:
Sell pound when the quote reaches 1.1799 (red line on the chart) and take profit at the price of 1.1740. Pressure could return at any moment, especially after an unsuccessful attempt at an upward correction
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 1.1839, but the MACD line should be in the overbought area, as only by that will the market reverse to 1.1799 and 1.1740.
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.