FX.co ★ How to trade GBP/USD on February 28? Simple tips for beginners.

Analysis of previous deals:

30M chart of the GBP/USD pair

The GBP/USD pair traded almost perfectly on Friday. We say this because the two key levels of the day - 1.3365 and 1.3440, were reached almost perfectly, forming several good signals. As we said earlier, there is no trend for the pound/dollar pair now. Before last Thursday's events, the price had been in the horizontal channel for a long time. The quotes crashed down on Thursday, but the movement of one day cannot be considered as a trend. Therefore, there is no trend line or channel at this time. They just don't make any sense, but there are also no reference points to build them. The pair's movement at the end of last week was as emotional as possible. And emotions continue to prevail in the foreign exchange market. Next week, the pair may continue to move as unpredictably as possible, under the influence of geopolitical factors. Thus, it is impossible to predict where the pair will move even with a 55% probability now. Therefore, we advise you to trade from the levels and follow the geopolitics as closely as possible.

5M chart of the GBP/USD pair

On the 5-minute timeframe, you can clearly see how well the pair reached important levels on Friday. The price bounced from the area of 1.3431-1.3440 at the very beginning of the European trading session, thus forming a sell signal. Subsequently, the price reached the nearest target level of 1.3366 and bounced off it twice. Thus, it was possible to earn about 40 points on a short position. Then, it was possible to open two long positions near the level of 1.3366. Two – because the first trade closed at a Stop Loss, set at breakeven: the price went up more than 20 points, but then returned to 1.3366. But the second deal was more successful. The total price went up about 46 points, but, of course, it was not possible to take all these 46 points, since the pair did not reach the target level this time. However, the deal should have been closed manually in the late afternoon and closer to the end of the trading week. Therefore, it was possible to earn 20 points. As a result, Friday turned out to be a pretty good day for novice traders.

How to trade on Monday:

The pair left the horizontal channel on the 30-minute TF, but at the same time, despite the strongest drop in quotes, there is no trend now. There is no trend line, no channel. The fall of the pound can easily continue tomorrow with the same intensity. And the corrective movement may continue. Now it is as difficult as possible to predict the pair's movements, since the market is in shock. How long this shock will last largely depends on the events in Ukraine. On the 5-minute TF tomorrow, it is recommended to trade by levels 1.3310, 1.3342, 1.3366, 1.3431-1.3440, 1.3488, 1.3537, 1.3580. When the price passes after the opening of the transaction in the right direction, 20 points should be set to Stop Loss at breakeven. There are no interesting events planned for tomorrow in the UK, as well as in the US. But Monday can become a "day of working out news over the weekend." On Saturday and Sunday, many events and statements related to the geopolitical conflict in Eastern Europe took place in the world, so tomorrow the market can start working them out from the very night.

Basic rules of the trading system:

1) The signal strength is calculated by the time it took to form the signal (bounce or overcome the level). The less time it took, the stronger the signal.

2) If two or more deals were opened near a certain level based on false signals (which did not trigger Take Profit or the nearest target level), then all subsequent signals from this level should be ignored.

3) In a flat, any pair can form a lot of false signals or not form them at all. But in any case, at the first signs of a flat, it is better to stop trading.

4) Trade deals are opened in the time period between the beginning of the European session and until the middle of the American one, when all deals must be closed manually.

5) On the 30-minute TF, using signals from the MACD indicator, you can trade only if there is good volatility and a trend, which is confirmed by a trend line or a trend channel.

6) If two levels are located too close to each other (from 5 to 15 points), then they should be considered as an area of support or resistance.

On the chart:

Support and Resistance Levels are the Levels that serve as targets when buying or selling the pair. You can place Take Profit near these levels.

Red lines are the channels or trend lines that display the current trend and show in which direction it is better to trade now.

The MACD indicator (14,22,3) consists of a histogram and a signal line. When they cross, this is a signal to enter the market. It is recommended to use this indicator in combination with trend lines (channels and trend lines).

Important speeches and reports (always contained in the news calendar) can greatly influence the movement of a currency pair. Therefore, during their exit, it is recommended to trade as carefully as possible or exit the market in order to avoid a sharp price reversal against the previous movement.

Beginners on Forex should remember that not every single trade has to be profitable. The development of a clear strategy and money management are the key to success in trading over a long period of time.