Trading plan for GBP/USD on October 9. Simple tips for beginners

GBPUSD continued to correct higher on Friday, although the chances of falling was much higher after the release of US data. The reason for this is that at least two very important reports were published. Of course, these reports were not as influential as they were half a year or a year ago, but the Nonfarm Payrolls and unemployment reports are by no means "ordinary" or "routine" data. The number of Nonfarm Payrolls exceeded expectations by two-fold, the previous report was revised upwards, and the unemployment rate remained unchanged. As expected, the US dollar rose after the key jobs data. However, the greenback eventually fell and GBPUSD continued its corrective move. Therefore, we can conclude that the market's reaction on Friday was illogical. At the same time, we have repeatedly mentioned the need for a bullish correction before the pair resumes its steady downward movement.

The 5-minute chart showed that the trading signals for the British pound were nearly identical to the signals for the euro. During the European session, there was a buy signal that closed at breakeven using stop loss. At the beginning of the US session, there was a sell signal that was impossible to react to. Later on, there was a highly accurate buy signal near the 1.2107 level, which brought a good amount of profit as the price started a strong upward movement, breaking through the 1.2171-1.2179 range and the 1.2235 level. Traders could earn 120 pips using the long position.

On the 30-minute chart, GBP/USD started a new corrective phase, which lasted for three days now. The upward movement can continue even without specific daily fundamental and macroeconomic bases (as we saw on Friday). A decline in the medium-term perspective is anticipated regardless, given the pound's prolonged and unjustified rise, but a correction seems more logical at the moment. The key levels on the 5M chart are 1.1992-1.2010, 1.2052, 1.2107, 1.2171-1.2179, 1.2235, 1.2307, 1.2372-1.2394, 1.2457-1.2488, 1.2544, 1.2605-1.2620, 1.2653, 1.2688. Once the price moves 20 pips in the right direction after opening a trade, you can set the stop-loss at breakeven. There are no interesting events lined up for the UK and the US. Therefore, we expect a bearish pullback and low volatility.

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.