Analysis of transactions and tips for trading GBP/USD
The test of 1.2307 took place when the MACD line moved upward from zero, prompting a signal to buy. This, along with the recent US statistics, led to a price increase of over 120 pips.
Relatively good data on the unemployment rate, jobless claims, and average earnings level in the UK led to a rise in pound in the morning. Then, the latest inflation data from the US triggered another growth, as disappointing numbers led to a significant sell-off of dollar.
UK inflation data came out today, indicating a slowdown. Although this led to a surge in pressure, the correction may be seen as an excellent opportunity to re-enter the market.
For long positions:
Buy when pound hits 1.2492 (green line on the chart) and take profit at the price of 1.2542 (thicker green line on the chart). Growth will occur in continuation of the bullish trend, even despite the decreasing inflation in the UK.
When buying, ensure that the MACD line lies above zero or just starts to rise from it. Pound can also be bought after two consecutive price tests of 1.2449, but the MACD line should be in the oversold area as only by that will the market reverse to 1.2492 and 1.2542.
For short positions:
Sell when pound reaches 1.2449 (red line on the chart) and take profit at the price of 1.2402. Pressure will continue until the pair hits 1.2500.
When selling, ensure that the MACD line lies below zero or drops down from it. Pound can also be sold after two consecutive price tests of 1.2492, but the MACD line should be in the overbought area as only by that will the market reverse to 1.2449 and 1.2402.
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.