Trading plan for GBP/USD on July 19. Simple tips for beginners

The GBP/USD pair finally started a more noticeable correction on Tuesday. However, before that, it tried to resume its uptrend, which appeared much easier than the beginning of the correction. The pair continues to hover near its annual highs and, over the course of three days of almost complete calm, it managed to retreat from them by 120-130 pips. Technically, this is a correction, but how many of these formal corrections have we seen in the past six months? Each time, the uptrend resumed.

Although everyone has become accustomed to this, the dollar strengthened precisely when it had a good reason to fall. Two days before Tuesday, the pair was practically stagnant, but there was no macroeconomic backdrop either. The US released two weak reports, and yet the dollar strengthened. That's all you need to know about the logic of the pair's current movements. Since the price has settled below the ascending trendline and failed to surpass the level of 1.3107, the pound may continue to fall, especially considering that it is heavily overbought and has not entered proper corrective phases. However, given the strength of the bullish sentiment, it would not be surprising if the uptrend resumes this time as well.

Several trading signals materialized on the 5-minute chart. Initially, the pair surpassed the 1.3107 mark but was unable to rise further. It couldn't even move 20 pips in the right direction. As a result, the long position closed with a small loss when a sell signal was formed around the same level. Beginners should have also executed this signal. Subsequently, the price fell, and by the middle of the US trading session, it surpassed the nearest level at 1.3043. Since there were no buy signals, shorts should have been manually closed closer to the evening. The profit amounted to at least 60 pips.

On the 30-minute chart, the GBP/USD pair is trying to start a bearish correction, but it is not going well so far. The pound's sluggish decline raises concerns that a strong uptrend could resume at any moment, even though it lacks any foundations. The key levels on the 5M chart are 1.2779-1.2801, 1.2848-1.2860, 1.2913, 1.2981-1.2993, 1.3043, 1.3107, 1.3145, 1.3210, 1.3241, and 1.3272. Once the price moves 20 pips in the right direction after opening a trade, you can set the stop-loss at breakeven. The UK will release its June inflation report, which can be considered as the main item of the week. It's possible that the market has already started to factor it in, but one cannot be certain about it. There are only two secondary reports lined up for the US, which could have a similar effect on the market as Tuesday's reports.

1) The strength of the signal depends on the time period during which the signal was formed (a rebound or a break). The shorter this period, the stronger the signal.

2) If two or more trades were opened at some level following false signals, i.e. those signals that did not lead the price to Take Profit level or the nearest target levels, then any consequent signals near this level should be ignored.

3) During the flat trend, any currency pair may form a lot of false signals or do not produce any signals at all. In any case, the flat trend is not the best condition for trading.

4) Trades are opened in the time period between the beginning of the European session and until the middle of the American one when all deals should be closed manually.

5) We can pay attention to the MACD signals in the 30M time frame only if there is good volatility and a definite trend confirmed by a trend line or a trend channel.

6) If two key levels are too close to each other (about 5-15 pips), then this is a support or resistance area.

Support and Resistance price levels can serve as targets when buying or selling. You can place Take Profit levels near them.

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

MACD indicator (14,22,3) is a histogram and a signal line showing when it is better to enter the market when they cross. This indicator is better to be used in combination with trend channels or trend lines.

Important speeches and reports that are always reflected in the economic calendars can greatly influence the movement of a currency pair. Therefore, during such events, it is recommended to trade as carefully as possible or exit the market in order to avoid a sharp price reversal against the previous movement.

Beginners should remember that every trade cannot be profitable. The development of a reliable strategy and money management are the key to success in trading over a long period of time.