How to trade GBP/USD on May 1. Simple trading tips and analysis for beginners

On Friday, the GBP/USD pair showed a somewhat different movement than the EUR/USD pair. In the first half of the day, there was also a sluggish downward movement, followed by growth in the second half. However, the pound's growth was much stronger than the euro's. Perhaps it's a coincidence... Either way, the British pound is appreciating again, and it is appreciating when the dollar should be rising. In the second half of the day, only secondary reports were published in the United States. For example, data on personal income and spending of the American population, which also almost fully matched forecast values. The personal consumption expenditure index was also published, which didn't surprise anyone, and the consumer sentiment index, which exactly matched traders' expectations. As we can see, there was simply nothing to react to during the US trading session. Nevertheless, traders still bought the pair, and so the pair can't correct properly.

Trading signals on the 5-minute chart were mediocre. In the first half of the day, the pair hovered around the 1.2466-1.2477 area in almost complete flat. Logically, the signals formed during this period were false. However, when the upward movement began, the corresponding signals should not have been worked out since the first ones were false. As a result, beginners could have worked out the first sell signal and received a loss of about 30 points. Next, a buy signal around the 1.2507-1.2520 area should have been worked out, and it brought novice traders about 30 points of profit, as the nearest target level was reached. As a result, the day ended with zero profit.

On the 30-minute chart, the GBP/USD pair continues to move upwards in the medium term or, at least, does not decline. Movements are still illogical, as is the market's reaction to fundamental and macroeconomic events. On the 5-minute chart, it is recommended to trade at the levels 1.2245-1.2260, 1.2343-1.2360, 1.2396, 1.2466-1.2477, 1.2507-1.2520, 1.2577-1.2597-1.2616, 1.2659-1.2674. As soon as the price passes 20 pips in the right direction, you should set a Stop Loss to breakeven. On Monday, no important events or reports are scheduled in the United Kingdom. In the United States, the ISM Manufacturing Business Activity Index, an important indicator, will be released, but its value needs to not match the forecast so we can see a reaction from the market. And the reaction can be anything, as market participants have obviously forgotten where the "sell" button is located.

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.

Support and Resistance levels are the levels that serve as targets when buying or selling the 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.