How to trade GBP/USD on March 2. Simple trading tips and analysis for beginners

GBP/USD fell to 1.1961 on Wednesday, from which it managed to move only a couple of days ago. As we can see, the bulls do not have enough strength to develop an upward momentum, so the pound often changes its direction. In the analysis of the higher charts, we said that there is a high probability of a flat or "swing". And even on the lower charts, these "swings" are rather obvious. There were no important events or reports in the UK on Wednesday, but the US published quite an important report, the ISM Manufacturing Index. It rose from 47.4 to 47.7 in February, which is not a significant change. The market was expecting it to be 48.0, but even such an increase would hardly give a strong support to the dollar, as anything below the 50 level is a negative trend for the sector. In the end, the market simply ignored this report. The dollar rallied in the afternoon, which proves this conclusion. In the medium term, I believe that the dollar should continue to rise and the pound would fall. But take note of the flat on the higher chart. On the lower ones, we might see movement in different directions by 200-300 points because of it.

The technical picture on the 5-minute chart looks very attractive for beginners. The pair rebounded from the area of 1.2065-1.2079, and managed to go down about 37 pips. Beginners had a right to use this signal. However it was difficult to gain profit from the short position since the pair quickly returned to the area of 1.2065-1.2079. It came back and rebounded again, thus forming another sell signal. In the second case, the price managed to reach the nearest target level of 1.1961 (with an error of 3 pips), so beginners could close the shorts with about 70 pips of profit. It was also possible to price the last buy signal and gain 50 pips more with the long position, closing it manually closer to the evening. Thus, it turned out to be quite a successful day.

On the 30-minute chart, GBP/USD started a new spiral of the upward movement, but quickly ended it. At the moment, there is no clear trend, trend line or channel for the pair. There might be a flat on the higher chart, while on the lower one, there will be frequent changes of the movement. On the 5-minute chart, it is recommended to trade at the levels 1.1716, 1.1793, 1.1863-1.1877, 1.1950-1.1957-1.1961, 1.2065-1.2079, 1.2138, 1.2171-1.2179, 1.2245-1.2260. As soon as the price passes 20 pips in the right direction, you should set a Stop Loss to breakeven. There are no important reports scheduled for Thursday in the UK and the US, but the pound has been trading very volatile in recent days, so interesting moves are likely to occur on Thursday.

1) The strength of the signal is determined by the time it took the signal to form (a rebound or a breakout of the level). The quicker it is formed, the stronger the signal is.

2) If two or more positions were opened near a certain level based on a false signal (which did not trigger a Take Profit or test the nearest target level), then all subsequent signals at this level should be ignored.

3) When trading flat, a pair can form multiple false signals or not form them at all. In any case, it is better to stop trading at the first sign of a flat movement.

4) Trades should be opened in the period between the start of the European session and the middle of the US trading hours when all positions must be closed manually.

5) You can trade using signals from the MACD indicator on the 30-minute time frame only amid strong volatility and a clear trend that should be confirmed by a trendline or a trend channel.

6) If two levels are located too close to each other (from 5 to 15 pips), they should be considered support and resistance levels.

pair. You can place Take Profit near these levels.

Red lines are channels or trend lines that display the current trend and show in which direction it is better to trade now.

The MACD indicator (14, 22, and 3) consists of a histogram and a signal line. When they cross, this is a signal to enter the market. It is recommended to use this indicator in combination with trend patterns (channels and trendlines).

Important announcements and economic reports that can be found on the economic calendar can seriously influence the trajectory of a currency pair. Therefore, at the time of their release, we recommend trading as carefully as possible or exiting the market in order to avoid sharp price fluctuations.

Beginners on Forex should remember that not every single trade has to be profitable. The development of a clear strategy and money management is the key to success in trading over a long period of time.