FX.co ★ GBPUSD: Simple Trading Tips for Novice Traders on October 18. Review of Yesterday's Forex Trades

Analysis of Trades and Trading Tips for the British Pound

The test of the 1.3004 level occurred when the MACD indicator had just started moving downward from the zero mark, which, in the context of the British pound's downward trend, confirmed a good entry point for selling. As a result, the pair dropped by 20 pips, but it didn't quite reach the target level of 1.2977, which coincides with the monthly low. Today, strong data on the growth of retail sales, including fuel costs in the UK for September, was released, which triggered purchases of the pound. The pair's growth may continue at the end of the week, as there are no reasons to sell the pound at these lows. However, acting on corrections and aiming for lower entries is better. I will rely more on implementing scenarios #1 and #2 for the intraday strategy.

Buy Signal

Scenario #1:

Today, I plan to buy the pound if the price reaches around 1.3072 (green line on the chart), with a target of 1.3124 (thicker green line on the chart). At 1.3124, I plan to exit the purchases and open sales in the opposite direction, aiming for a move of 30-35 pips in the opposite direction. The pound's growth today can be expected as part of the ongoing correction. Important: Before buying, ensure that the MACD indicator is above the zero mark and starting to rise.

Scenario #2:

I also plan to buy the pound today if there are two consecutive tests of the 1.3032 level when the MACD indicator is in the oversold area. This will limit the pair's downward potential and may lead to a reversal to the upside. Growth can be expected toward the opposite levels of 1.3072 and 1.3124.

Sell Signal

Scenario #1:

Today, I plan to sell the pound after breaking below the 1.3032 level (red line on the chart), which will lead to a quick decline in the pair. The key target for sellers will be the 1.2977 level, where I plan to exit the sales and immediately open purchases in the opposite direction, aiming for a move of 20-25 pips in the opposite direction. Selling the pound is viable if there is weak bullish activity after the data release. Important: Before selling, ensure that the MACD indicator is below the zero mark and starting to decline.

Scenario #2:

I also plan to sell the pound today if there are two consecutive tests of the 1.3072 level when the MACD indicator is in the overbought area. This will limit the pair's upward potential and may lead to a downward market reversal. A decline can be expected toward the opposite levels of 1.3032 and 1.2977.

What's on the chart:

Thin green line – the entry price to buy the trading instrument;

Thick green line – the approximate price to set Take Profit or manually lock in profits, as further growth above this level is unlikely;

Thin red line – the entry price to sell the trading instrument;

Thick red line – the approximate price to set Take Profit or manually lock in profits, as further declines below this level are unlikely;

MACD indicator – When entering the market, it's important to use overbought and oversold zones.

Important:

Novice traders in the Forex market should be cautious when making entry decisions. It's best to stay out of the market before the release of major fundamental reports to avoid sharp price fluctuations. If you decide to trade during news releases, always set stop orders to minimize losses. You can quickly lose your entire deposit without stop orders, especially if you don't practice money management and trade with large volumes.

And remember, successful trading requires a clear trading plan, like the one presented above. Spontaneous decision-making based on the current market situation is a losing strategy for intraday traders.