Analysis of transactions in the GBP / USD pair
The price test of 1.1052 happened when the MACD line was far below zero, which limited the downside potential of the pair. Some time later, quite a lot of tests occurred, but they were no longer worth paying attention to. No other signals appeared for the rest of the day.
A number of reports are scheduled to be released today, and they are likely to set the direction of GBP/USD. Average wages are expected to show growth, otherwise the crisis in the cost of living in the UK will only increase. There will also be data on jobless claims and unemployment rate, but they will be of little interest. The morning will end with a speech from Bank of England President Andrew Bailey, who may outline plans for further support of the forex market.
In the afternoon, the US will publish a report on business optimism; however, it will not affect the market much. There will also be speeches from FOMC members Patrick Harker and Loretta Mester, which is likely to be identical to what is heard from other Fed officials over the past week.
For long positions:
Buy pound when the quote reaches 1.1057 (green line on the chart) and take profit at the price of 1.1133 (thicker green line on the chart). Growth will occur as long as upcoming statistics exceed expectations. But remember that when buying, the MACD line should be above zero or is starting to rise from it.
Pound can also be bought at 1.1010, however, the MACD line should be in the oversold area as only by that will the market reverse to 1.1057 and 1.1133.
For short positions:
Sell pound when the quote reaches 1.1010 (red line on the chart) and take profit at the price of 1.0957. Pressure will return if the attempt for rebound fails. But take note that when selling, the MACD line should be below zero or is starting to move down from it.
Pound can also be sold at 1.1057, however, the MACD line should be in the overbought area, as only by that will the market reverse to 1.1010 and 1.0957.
What's on the chart:
The thin green line is the key level at which you can place long positions in the GBP/USD pair.
The thick green line is the target price, since the quote is unlikely to move above this level.
The thin red line is the level at which you can place short positions in the GBP/USD pair.
The thick red line is the target price, since the quote is unlikely to move below this level.
MACD line - when entering the market, it is important to be guided by the overbought and oversold zones.
Important: Novice traders need to be very careful when making decisions about entering the market. Before the release of important reports, it is best to stay out of the market to avoid being caught in sharp fluctuations in the rate. If you decide to trade during the release of news, then always place stop orders to minimize losses. Without placing stop orders, you can very quickly lose your entire deposit, especially if you do not use money management and trade large volumes.
And remember that for successful trading, you need to have a clear trading plan. Spontaneous trading decision based on the current market situation is an inherently losing strategy for an intraday trader.