A test of the 1.2433 price level occurred when the MACD indicator began to move downward from the zero mark, confirming a valid sell entry for the pound. As a result, the pair declined by approximately 50 pips. Additionally, buying on the rebound from 1.2384 allowed traders to capture about 40 pips in profit.
The news of rising U.S. inflation was quickly priced into the market. It seems that most of the negative effects related to inflation have already been factored in, and many traders are now anticipating positive developments from the U.S.-Russia negotiations.
Today, several key economic reports are expected, which could clarify the current situation and provide momentum for the further movement of GBP/USD. The focus will be on the UK GDP growth rate and industrial production data.
Regarding today's economic data , several important indicators are set to be released that could clarify the current situation and influence GBP/USD movements. Specifically, we will be looking at the changes in UK GDP and industrial production volumes. Particular attention should be given to the trends in industrial production, as it serves as a leading indicator of overall economic growth. A decline in these indicators may suggest a slowdown in business activity, which could lead to a weakening of the pound sterling.
If the GDP data is weak, it would be prudent to consider short positions on GBP/USD. Conversely, if the GDP and industrial production data are optimistic, we might see a breakthrough of key resistance levels, leading to further growth in GBP/USD quotes. In this scenario, exploring opportunities for long positions would be advisable.
For the intraday strategy, my focus will be on implementing scenarios #1 and #2.
Scenario #1: I will consider buying the pound today if the price reaches 1.2503 (green line on the chart) with a target of 1.2548. At 1.2548, I plan to exit long positions and initiate short trades, expecting a 30-35 pip downward move. The bullish trend continuation can be expected. Important! Before buying, ensure the MACD indicator is above the zero mark and just beginning to rise.
Scenario #2: I will also consider buying the pound if the price tests 1.2473 twice while the MACD indicator is in oversold territory. This will limit the pair's downside potential and trigger an upward market reversal. The expected target levels are 1.2503 and 1.2548.
Sell SignalScenario #1: Selling the pound will be considered after breaking below the 1.2473 level (red line on the chart), which will likely trigger a rapid decline in the pair. The key target for sellers will be 1.2434, where I plan to exit short positions and immediately buy on a rebound (expecting a 20-25 pip upward move). Important! Before selling, ensure the MACD indicator is below the zero mark and beginning to decline.
Scenario #2: I will also consider selling the pound if the price tests 1.2503 twice while the MACD indicator is in overbought territory. This will cap the pair's upside potential and trigger a downward reversal. The expected downside targets are 1.2473 and 1.2434.
