FX.co ★ Analysis and trading tips for GBP/USD on November 11

Analysis of transactions in the GBP / USD pair

The test of 1.1382 occurred at the time when the MACD line was just starting to move below zero, which was a good reason to sell. However, there was no massive sell-off as traders focused on the US inflation data. No other signals appeared for the rest of the day.

Pound rose after news of lower consumer prices in the US. This is because the Fed now has reason to slow down its aggressive increase in interest rates.

Today, data on UK's GDP is due, which could lead to a powerful sell-off, provided that the figure decreases. Weak industrial and manufacturing output will add further pressure to the market. The report on trade balance will be of little interest.

In the afternoon, the US will publish its report on consumer expectations and consumer sentiment. An improvement in the latter will return demand for dollar, which will lead to a downward correction in GBP/USD.

For long positions:

Buy pound when the quote reaches 1.1743 (green line on the chart) and take profit at the price of 1.1830 (thicker green line on the chart). Growth will occur after strong data on UK GDP. 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 1.1688, however, the MACD line should be in the oversold area as only by that will the market reverse to 1.1743 and 1.1830.

For short positions:

Sell pound when the quote reaches 1.1688 (red line on the chart) and take profit at the price of 1.1597. Pressure will return if the UK reports weak economic data. 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 1.1743, however, the MACD line should be in the overbought area as only by that will the market reverse to 1.1688 and 1.1597.

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.