FX.co ★ GBP/USD: Simple Trading Tips for Beginners on August 28. Analysis of Yesterday's Forex Trades

Trade Analysis and Tips for Trading the British Pound

The price test of 1.3213 occurred when the MACD indicator went down a lot from the zero mark, limiting the pair's further downward potential within the upward trend. For this reason, I did not sell the pound. Unfortunately, I did not get another chance to test 1.3213 for buying. A retail sales report from the Confederation of British Industry did not affect the market, while US data led to a more significant pound correction in early US trading, after which demand for the dollar sharply declined. Today, we are expecting a speech from Bank of England MPC member Catherine L. Mann, and her dovish speech aimed at further interest rate cuts in the UK could negatively affect the bullish prospects of the British pound, which has been struggling with growth since the start of the Asian session. For the intraday strategy, I will rely more on scenarios No. 1 and 2.

Buy Signal

Scenario No 1: Today, I plan to buy the pound when it reaches the entry point at 1.3239, plotted by the green line on the chart, with the goal of rising to the level of 1.3265, plotted by the thicker green line on the chart. Around 1.3265, I plan to exit long positions and open short positions in the opposite direction, counting on a movement of 30-35 pips from the level. It is unlikely that we will see strong growth for the pound today. It is better to act as low as possible. Important: Before buying, ensure the MACD indicator is above the zero mark and starting to rise from it.

Scenario No 2: I also plan to buy the pound today in case of two consecutive price tests of 1.3213 when the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to a reverse market upturn. One can expect growth to the opposite levels of 1.3229 and 1.3265.

Sell Signal

Scenario No 1: Today, I plan to sell the pound after testing the level of 1.3213, plotted by the red line on the chart, which will lead to a rapid decline in GBP/USD. The key target for sellers will be the level of 1.3180, where I will exit short positions and immediately open long positions in the opposite direction (expecting a movement of 20-25 pips in the opposite direction from that level). It is possible to sell the pound if buyers fail to return above 1.3230. Important: Before selling, make sure that the MACD indicator is below the zero mark and is just starting to decline from it.

Scenario No 2: I also plan to sell the pound today in case of two consecutive price tests of 1.3229 when the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a reverse market downturn. One can expect a decline to the opposite levels of 1.3213 and 1.3180.

What's on the Chart:

Thin green line: the entry price at which you can buy the trading instrument.

Thick green line: the estimated price at which you can set Take Profit or manually close positions, as further growth above this level is unlikely.

Thin red line: the entry price at which you can sell the trading instrument.

Thick red line: an estimated price at which you can place Take Profit or manually close positions, as further decline below this level is unlikely.

MACD indicator: when entering the market, it is essential to be guided by overbought and oversold zones.

Important: Novice traders in the forex market need to be very careful when making decisions about entering the market. It is best to stay out of the market before important fundamental reports are released to avoid getting caught in sharp price fluctuations. If you decide to trade during news releases, always place stop orders to minimize losses. You must set stop orders to avoid losing your entire deposit, especially if you don't use money management and trade in large volumes.

Remember, a clear trading plan, like the one I've outlined, is essential for successful trading. Making impulsive decisions based on the current market situation is a losing strategy for novice intraday traders.