Trade Analysis and Tips for Trading the British Pound

The test of the 1.3021 price level occurred when the MACD indicator was well above the zero mark, limiting the pair's upward potential—especially in the absence of significant fundamental data. For this reason, I didn't buy the pound. A second test of this level shortly after found the MACD indicator in overbought territory, which triggered Scenario #2 for selling. As a result, the pair dropped over 40 points. In the second half of the day, data on U.S. Q3 GDP change, ADP employment, and core personal consumption expenditures are expected. Strong data could lead to a much larger pound sell-off. If not, buyers may return to the market. For the intraday strategy, I'll primarily focus on implementing Scenario #1, as I expect strong, directed movement following the data.

Buy Signal

Scenario #1: Today, I plan to buy the pound at an entry point around 1.2984 (green line on the chart), aiming for growth toward 1.3030. Around 1.3030, I plan to exit buys and open sells in anticipation of a 30–35-point drop from the level. Pound growth today can only be expected after weak U.S. GDP data. Important: Before buying, ensure that the MACD indicator is above the zero line and just starting to move upward.

Scenario #2: I also plan to buy the pound today in case of two consecutive tests of the 1.2959 price level, with the MACD indicator in the oversold zone. This will limit the pair's downward potential and prompt an upward reversal. Growth toward the 1.2984 and 1.3030 levels can be expected.

Sell Signal

Scenario #1: I plan to sell the pound after it moves below 1.2959 (red line on the chart), which will lead to a quick decline. The key target for sellers will be 1.2918, where I'll exit sales and buy immediately in the opposite direction (expecting a 20–25-point reversal from the level). Sellers will likely become active following strong economic reports. Important: Before selling, ensure the MACD indicator is below the zero line and just starting its descent.

Scenario #2: I also plan to sell the pound today in case of two consecutive tests of the 1.2984 price level, with the MACD indicator in overbought territory. This will limit the pair's upward potential and prompt a downward market reversal. A decline toward the 1.2959 and 1.2918 levels can be expected.

Chart Key:

• Thin green line – entry price for buying the asset.
• Thick green line – expected price for setting Take Profit or manually fixing profit, as further growth beyond this level is unlikely.
• Thin red line – entry price for selling the asset.
• Thick red line – expected price for setting Take Profit or manually fixing profit, as further declines below this level are unlikely.
• MACD Indicator: When trading, monitor overbought and oversold zones.

Important: Beginner Forex traders should exercise great caution when entering the market. To avoid sharp price fluctuations, it's best to stay out of the market before the release of major fundamental reports. If you decide to trade during news releases, always set stop-loss orders to minimize losses. Without stop-loss orders, you could quickly lose your entire deposit, especially when trading large volumes and lacking money management.

And remember, successful trading requires a clear trading plan, like the example I've provided here. Making impulsive trading decisions based on immediate market conditions is generally a losing strategy for intraday traders.