Trading plan for GBP/USD on November 21. Simple tips for beginners

The GBP/USD pair continued to rise to start the week. It wasn't a particularly strong movement, but it was still an upward movement in conditions where it would be more logical to see the downtrend resume in the medium-term. Recall that on Friday and Monday, there was no macroeconomic reason for the pound to show an upward movement. Therefore, it is illogical for the pound to show such strength at the moment. Nevertheless, we have an ascending trend line, so there are at least some grounds for growth. We believe that the British pound has no reason to rise at the moment, but as long as the uptrend persists, one can assume anything—there are no sell signals yet.

On the 5-minute chart, two trading signals were generated, but their quality is clearly visible in the chart above. To be more precise, during most of the European and US sessions, the price was between the levels of 1.2457 and 1.2488, with a distance of 31 pips. Obviously, trading between these levels made no sense, as it was impossible to expect good profit. The price consolidated above the level of 1.2488 twice, but in both cases, it went up by no more than 20 pips. And that's in the best case. Beginners could open one long position and even close it with minimal profit, but this isn't what traders usually expect when opening trades.

On the 30-minute chart, the GBP/USD pair unexpectedly resumed its upward movement. But we still believe that it will end soon. Currently, we have an ascending trend line, and overcoming it will allow us to determine the end of the uptrend. We believe that the pound's current upward movement is illogical, and trading sessions on Friday and Monday confirms this. The key levels on the 5M chart are 1.2052, 1.2089-1.2107, 1.2164-1.2179, 1.2235, 1.2270, 1.2310, 1.2372-1.2387, 1.2457-1.2488, 1.2544, 1.2605-1.2620, 1.2653, 1.2688, 1.2748. Once the price moves 20 pips in the right direction after opening a trade, you can set the stop-loss at breakeven. On Tuesday, the UK event calendar is empty again, while the US will publish the minutes of the Federal Reserve meeting. We don't consider this an important event, and in any case, it will be published too late to use it as an impetus.

1) Signal strength is determined by the time taken for its formation (either a bounce or level breach). A shorter formation time indicates a stronger signal.

2) If two or more trades around a certain level are initiated based on false signals, subsequent signals from that level should be disregarded.

3) In a flat market, any currency pair can produce multiple false signals or none at all. In any case, the flat trend is not the best condition for trading.

4) Trading activities are confined between the onset of the European session and mid-way through the U.S. session, after which all open trades should be manually closed.

5) On the 30-minute timeframe, trades based on MACD signals are only advisable amidst substantial volatility and an established trend, confirmed either by a trendline or trend channel.

6) If two levels lie closely together (ranging from 5 to 15 pips apart), they should be considered as a support or resistance zone.

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

Red lines represent channels or trend lines, depicting the current market trend and indicating the preferable trading direction.

The MACD(14,22,3) indicator, encompassing both the histogram and signal line, acts as an auxiliary tool and can also be used as a signal source.

Significant speeches and reports (always noted in the news calendar) can profoundly influence the price dynamics. Hence, trading during their release calls for heightened caution. It may be reasonable to exit the market to prevent abrupt price reversals against the prevailing trend.

Beginners should always remember that not every trade will yield profit. Establishing a clear strategy coupled with sound money management is the cornerstone of sustained trading success.