Review of Trades and Trading Tips for the British Pound

The test of the 1.3443 price level occurred when the MACD indicator had already moved significantly below the zero line, which limited the pair's downward potential. The second test of 1.3443 coincided with the MACD being in the oversold zone, leading to the implementation of Buy Scenario No. 2 for the pound and resulting in a 5-point rise in the pair.

In the second half of the day, financial markets will focus on the release of the Richmond Fed Manufacturing Index, a key indicator of economic activity in one of the United States' industrial regions. The results of this report may have a significant impact on short-term fluctuations of the U.S. dollar against the pound, reflecting the strength or weakness of the American economy. Alongside the economic data, market participants will closely monitor speeches by two Federal Open Market Committee members — Lorie K. Logan and Lisa D. Cook. Their comments regarding the outlook for monetary policy, inflation trends, and the overall state of the economy may provide important guidance for the market. Particular attention will be paid to any hints regarding future interest rate decisions, especially toward further rate hikes.

As for the intraday strategy, I will rely primarily on the implementation of Scenarios No. 1 and No. 2.

Buy Signal

Scenario No. 1

Today, I plan to buy the pound upon reaching the entry point around 1.3450 (green line on the chart), with a target at 1.3484 (the thicker green line on the chart). Around 1.3484, I plan to exit long positions and open short positions in the opposite direction (expecting a movement of 30–35 points in the opposite direction from the level). The pound is likely to rise today only if weak U.S. data is released.

Important! Before buying, make sure that the MACD indicator is above the zero line and is only beginning to rise from it.

Scenario No. 2

I also plan to buy the pound today in the event of two consecutive tests of the 1.3431 price level while the MACD indicator is in the oversold zone. This will limit the pair's downward potential and lead to an upward market reversal. Growth toward the opposite levels of 1.3450 and 1.3484 can then be expected.

Sell Signal

Scenario No. 1

I plan to sell the pound today after the 1.3431 level is updated (red line on the chart), which will lead to a rapid decline in the pair. The key target for sellers will be the 1.3401 level, where I plan to exit short positions and immediately open long positions in the opposite direction (expecting a movement of 20–25 points in the opposite direction from the level). Pressure on the pound will return today in the event of failed negotiations.

Important! Before selling, make sure that the MACD indicator is below the zero line and is only beginning to decline from it.

Scenario No. 2

I also plan to sell the pound today in the event of two consecutive tests of the 1.3450 price level while the MACD indicator is in the overbought zone. This will limit the pair's upward potential and lead to a downward market reversal. A decline toward the opposite levels of 1.3431 and 1.3401 can then be expected.

What Is Shown on the Chart

• Thin green line – the entry price at which the trading instrument can be bought;
• Thick green line – the estimated price where Take Profit orders can be placed or profits can be fixed manually, as further growth above this level is unlikely;
• Thin red line – the entry price at which the trading instrument can be sold;
• Thick red line – the estimated price where Take Profit orders can be placed or profits can be fixed manually, as further decline below this level is unlikely;
• MACD indicator. When entering the market, it is important to follow overbought and oversold zones.

Important

Beginner Forex traders should make market entry decisions very carefully. Before the release of major fundamental reports, it is best to stay out of the market in order to avoid sharp price fluctuations. If you decide to trade during news releases, always place stop-loss orders to minimize losses. Without stop-loss orders, you can lose your entire deposit very quickly, especially if you do not use proper money management and trade large volumes.

And remember, successful trading requires a clear trading plan, such as the one presented above. Spontaneous trading decisions based on the current market situation are inherently a losing strategy for an intraday trader.