FX.co ★ Analysis and trading tips for GBP/USD on March 10

Analysis of transactions and tips for trading GBP/USD

The pair tested 1.1864 at a time when the MACD line was just starting to move above zero, which was a good reason to buy. It resulted in a price increase of about 30 pips. No other market signal appeared for the rest of the day.

Contrary to expectations, the lack of statistics yesterday did not prevent pound from continuing to rise. As for today, even though ahead are upcoming data on UK GDP, industrial production and manufacturing output, which could prompt another surge, the upside potential is likely to be limited as reports on the US labor market will strengthen dollar demand. A fall in unemployment rate, jump in non-farm payrolls and increase in average hourly earnings are obvious reasons to buy the currency. But if the data actually disappoints, pound will get a chance to resume gains.

For long positions:

Buy pound when the quote reaches 1.1932 (green line on the chart) and take profit at the price of 1.1980 (thicker green line on the chart). Growth is possible if the UK publishes strong economic reports. However, when buying, traders should make sure that the MACD line is above zero or is starting to rise from it. Pound can also be bought at 1.1908, but the MACD line should be in the oversold area as only by that will the market reverse to 1.1932 and 1.1980.

For short positions:

Sell pound when the quote reaches 1.1908 (red line on the chart) and take profit at the price of 1.1868. Pressure may return after strong US labor market data. However, when selling, make sure that the MACD line is below zero or is starting to move down from it. Pound can also be sold at 1.1932, but the MACD line should be in the overbought area as only by that will the market reverse to 1.1908 and 1.1868.

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.