GBP/USD: trading plan for the US session on March 6th (analysis of morning deals). The pound returned to a weekly high

In my morning forecast, I paid attention to the 1.2730 level and planned to make decisions on entering the market from it. Let's look at the 5-minute chart and figure out what happened there. The growth and formation of a false breakdown there allowed us to get a suitable signal to sell the pound, however, at the time of writing, it had not reached a major sale. In the afternoon, the technical picture was only partially revised.

To open long positions on GBP/USD, it is required:

Weak data on the UK construction sector allowed the pound to regain its position, but the rest of the movement will be based on American labor market statistics expected in the afternoon. In addition, Chairman of the Board of Governors of the Federal Reserve Jerome Powell will give a speech to Congress today. Much will also depend on his words. Strong US data and Powell's hawkish position will return pressure on the pound, and only the formation of a false breakdown in the area of the nearest support of 1.2697 will give an entry point with the aim of rising to the resistance of 1.2730 formed by the results of yesterday. A breakout and a top-down test of this range will strengthen the chance for further recovery of GBP/USD, which will lead to new purchases and allow you to get to 1.2769. In the case of an exit above this range, we can talk about a breakthrough to 1.2797, where I'm going to fix profits. In the scenario of a fall in GBP/USD and the absence of buyers at 1.2697 in the afternoon, and there are moving averages, sellers will get a chance for the pound to fail in the area of 1.2666. Buying there will only occur on a false breakout. I plan to enter long positions on GBP/USD immediately on a rebound from 1.2636, with the target of a correction of 30-35 points within the day.

To open short positions on GBP/USD, the following is required:

Sellers attempted to re-enter the market, and until trading is conducted below 1.2730, we can expect a downward movement in the pair. Growth and the repeated formation of a false breakout during the release of US labor market data will confirm the presence of large sellers in the market, providing another selling signal. In this case, we can expect a decrease and a test of support at 1.2697, where the moving averages, playing on the side of buyers, are located. Breaking and reverse testing from bottom to top of this range will increase pressure on the pair, giving bears an advantage and another entry point for selling with the target of updating 1.2666, where I expect more active buyers. The more distant target will be the minimum of 1.2636, where I will take a profit. In the case of an increase in GBP/USD and the absence of bears at 1.2730 in the second half of the day, bulls will strengthen their advantage, leading to the development of a new upward trend and upward movement towards the next resistance at 1.2769. I will also consider entering short positions there only on a false breakout. In the absence of activity there, I recommend opening short positions on GBP/USD from 1.2797, counting on the pair's rebound down by 30-35 points within the day.

Indicator Signals:

Moving Averages

Trading is conducted above the 30 and 50-day moving averages, indicating further pound growth.

Note: The period and prices of moving averages are considered by the author on the hourly chart H1 and differ from the general definition of classic daily moving averages on the daily chart D1.

Bollinger Bands

In case of a decline, the lower boundary of the indicator around 1.2685 will act as support.

Description of Indicators