FX.co ★ Trading plan for starters of EUR/USD and GBP/USD on August 16, 2021

Here are the details of the economic calendar from August 13:

Last Friday, Spain and France released their inflation data. Market participants are not so interested in indicators for individual EU countries, so there was no market attention.

Analysis of trading charts from August 13:

The EUR/USD pair has moved from stagnation in the range of 1.1725/1.1755 to the technical correction stage. This scenario of price development is quite expected due to the strong pivot point in this year's base.

The trading plan on August 13 considered the scenario of a breakdown of one or another border of the 1.1725/1.1755 range. This tactic made it possible for traders to enter the market at the moment of an out-of-range impulse. In our case, it was possible to open a buy position.

The GBP/USD pair considers the level of 1.3800 as a pivot point, relative to which the price rebounded.

The support level has been repeatedly tested for strength by market participants, earning the status of support.

The trading plan on August 13 considered the scenario of a downward development, but in order for the signal to be confirmed, the price had to keep below the level of 1.3800 for an H4 period.

* The support level is the so-called price level, from which the quote can slow down or stop the downward course. The principle of constructing this level is to reduce the points of support on the history of the chart, where the price reversal in the market has already occurred earlier.

It is worth considering that the support level cannot be eternal and constantly lead to a price reversal. Therefore, traders always have an alternative scenario for the development of the market, which considers the breakdown of this level.

August 16 economic calendar:

There are no important statistics from Europe, Britain, and the United States today. Therefore, the market will focus on information flow and on technical analysis.

In most cases, Monday does not contain important statistics in the economic calendar, but this does not mean that the market will stand in one place that day.

Trading plan for EUR/USD on August 16:

The resistance level of 1.1800 is on the way of the corrective move, relative to which there was a reduction in the volume of long positions. Thus, selling positions have become relevant on the market again, which leads to a gradual recovery of the dollar against the euro.

Market participants will most actively consider a downward movement after holding the price below the level of 1.1770. This can open the way towards the pivot point of 1.1700.

The upward movement is considered by traders as a tightening of the correction. To do this, the quote must hold above the level of 1.1810 in the H4 time frame.

Trading plan for GBP/USD on August 16:

The price rebound from the support level of 1.3800 returned the quote to the area of 1.3875 level, where a reduction in the volume of long positions was observed last August 11. If the natural basis of the past repeats, a reversal is possible towards the pivot point of 1.3800.

An alternative scenario of price development will be considered if the quotes are kept above the level of 1.3900. This could open the way towards the psychological level of 1.4000.

• Short positions or Short means sell positions.
• Long positions or Long means buy positions.
• Psychological levels are round values (1.2000,1.3000, 1.4000, and 1.5000, etc.) that serve as key coordinates in the market that traders pay special attention to. These levels are often used as support or resistance.

What is reflected in the trading charts?

A candlestick chart view is graphical rectangles of white and black light, with sticks on top and bottom. When analyzing each individual candle in detail, you will see its characteristics of a relative time period: the opening price, the closing price, the maximum and minimum prices.

Horizontal levels are price coordinates, relative to which a stop or a price reversal may occur. These levels are called support and resistance in the market.

Circles and rectangles are highlighted examples where the price of the story unfolded. This color selection indicates horizontal lines that may put pressure on the quote in the future.

The up/down arrows are the reference points of the possible price direction in the future.

Golden Rule: It is necessary to figure out what you are dealing with before starting to trade with real money. Learning to trade is so important for a novice trader because the market is constantly dynamics and it is important to understand what is happening on it.