Analysis of transactions and tips for trading GBP/USD
The test of 1.2360, coinciding with the time that the MACD line had just started to move down from zero, led to a sell signal in the market. However, the price decline only amounted to about 30 pips.
Thursday's retail sales data in the UK did not help pound recover, but today's data on the overall retail sales for April could bring back bullish sentiment in the market. Most likely, buyers will take advantage of the moment and attempt to create some upward correction by the end of the week. However, the deadlock on the issue of US debt ceiling could hamper the movement.
For long positions:
Buy pound when the level of 1.2353 (green line on the chart) is reached and take profit at the price of 1.2392 (thicker green line on the chart). Growth could occur, but it will only be a correction. Nevertheless, when buying, traders should make sure that the MACD line is above zero or is starting to rise from it. Pound can also be bought after two consecutive price tests of 1.2325, but the MACD line should be in the oversold area as only by that will the market reverse to 1.2353 and 1.2392.
For short positions:
Sell pound when the level of 1.2325 (red line on the chart) is reached and take profit at the price of 1.2299. Pressure will intensify after a failed attempt to consolidate above 1.2353. However, when selling, traders should make sure that the MACD line is below zero or is starting to move down from it. Pound can also be sold after two consecutive price tests of 1.2353, but the MACD line should be in the overbought area as only by that will the market reverse to 1.2325 and 1.2299.
What's on the chart:
Thin green line - entry price at which you can buy GBP/USD
Thick green line - estimated price where you can set Take-Profit (TP) or manually fix profits, as further growth above this level is unlikely.
Thin red line - entry price at which you can sell GBP/USD
Thick red line - estimated price where you can set Take-Profit (TP) or manually fix profits, as further decline below this level is unlikely.
MACD line- it is important to be guided by overbought and oversold areas when entering the market
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.