Analysis of Trades and Trading Tips for the British Pound

A test of the 1.2433 price level occurred when the MACD indicator began to move downward from the zero mark, confirming a valid sell entry for the pound. As a result, the pair declined by approximately 50 pips. Additionally, buying on the rebound from 1.2384 allowed traders to capture about 40 pips in profit.

The news of rising U.S. inflation was quickly priced into the market. It seems that most of the negative effects related to inflation have already been factored in, and many traders are now anticipating positive developments from the U.S.-Russia negotiations.

Today, several key economic reports are expected, which could clarify the current situation and provide momentum for the further movement of GBP/USD. The focus will be on the UK GDP growth rate and industrial production data.

Regarding today's economic data , several important indicators are set to be released that could clarify the current situation and influence GBP/USD movements. Specifically, we will be looking at the changes in UK GDP and industrial production volumes. Particular attention should be given to the trends in industrial production, as it serves as a leading indicator of overall economic growth. A decline in these indicators may suggest a slowdown in business activity, which could lead to a weakening of the pound sterling.

If the GDP data is weak, it would be prudent to consider short positions on GBP/USD. Conversely, if the GDP and industrial production data are optimistic, we might see a breakthrough of key resistance levels, leading to further growth in GBP/USD quotes. In this scenario, exploring opportunities for long positions would be advisable.

For the intraday strategy, my focus will be on implementing scenarios #1 and #2.

Buy Signal

Scenario #1: I will consider buying the pound today if the price reaches 1.2503 (green line on the chart) with a target of 1.2548. At 1.2548, I plan to exit long positions and initiate short trades, expecting a 30-35 pip downward move. The bullish trend continuation can be expected. Important! Before buying, ensure the MACD indicator is above the zero mark and just beginning to rise.

Scenario #2: I will also consider buying the pound if the price tests 1.2473 twice while the MACD indicator is in oversold territory. This will limit the pair's downside potential and trigger an upward market reversal. The expected target levels are 1.2503 and 1.2548.

Sell Signal

Scenario #1: Selling the pound will be considered after breaking below the 1.2473 level (red line on the chart), which will likely trigger a rapid decline in the pair. The key target for sellers will be 1.2434, where I plan to exit short positions and immediately buy on a rebound (expecting a 20-25 pip upward move). Important! Before selling, ensure the MACD indicator is below the zero mark and beginning to decline.

Scenario #2: I will also consider selling the pound if the price tests 1.2503 twice while the MACD indicator is in overbought territory. This will cap the pair's upside potential and trigger a downward reversal. The expected downside targets are 1.2473 and 1.2434.

Chart Notes

• Thin green line: Entry price for buying the trading instrument.
• Thick green line: A suggested target for Take Profit or manually locking in profits, as further growth above this level is unlikely.
• Thin red line: Entry price for selling the trading instrument.
• Thick red line: A suggested target for Take Profit or manually locking in profits, as further decline below this level is unlikely.
• MACD Indicator: Critical for identifying overbought and oversold zones to guide market entry decisions.

Important Note for Beginner Traders

• Always approach market entry decisions cautiously.
• Avoid trading during major news releases to sidestep volatile price swings.
• If trading during news releases, always set stop-loss orders to minimize losses.
• Trading without stop-loss orders or money management practices can quickly deplete your deposit, especially when using large volumes.
• A clear trading plan, like the one outlined above, is essential for successful trading. Spontaneous trading decisions based on current market conditions are inherently disadvantageous for intraday traders.