Analysis of Trades and Trading Tips for the British Pound

The test of the 1.2523 price level occurred when the MACD indicator began to move downward from the zero mark, confirming an appropriate entry point for selling the pound. This resulted in a drop to the target level of 1.2498.

The pound sterling continues to trade within a horizontal channel, despite yesterday's attempts by sellers to break below the weekly low. The decline in the pair was quickly reversed, allowing the market to maintain balance. Once again, there is no significant economic data coming from the UK today, so I expect trading to remain confined to the channel. Despite the absence of new data, the current state of the country's economy raises questions among economists and traders, and future signals from the Bank of England will be crucial for decision-making. However, no significant changes are anticipated from the central bank for the remainder of the year.

Regarding intraday strategy, I will rely more on the implementation of Scenario #2.

Buy Signal

Scenario #1: I plan to buy the pound today upon reaching the entry point around 1.2532 (green line on the chart) with a target of 1.2568 (thicker green line on the chart). Around 1.2568, I plan to exit the buy position and open sell positions in the opposite direction (expecting a movement of 30-35 pips from the level). The pound's growth should only be expected as part of a correction. Important! Before buying, ensure that the MACD indicator is above the zero mark and beginning its upward movement.

Scenario #2: I also plan to buy the pound today if there are two consecutive tests of the 1.2514 level when the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to an upward market reversal. Growth toward the opposing levels of 1.2532 and 1.2568 can be expected.

Sell Signal

Scenario #1: I plan to sell the pound today after breaking below the 1.2514 level (red line on the chart), which should lead to a quick decline in the pair. The key target for sellers will be 1.2478, where I plan to exit the sell position and immediately open buy positions in the opposite direction (expecting a movement of 20-25 pips from the level). Selling the pound can follow the continuation of the downtrend. Important! Before selling, ensure that the MACD indicator is below the zero mark and just beginning its downward movement.

Scenario #2: I also plan to sell the pound today in the event of two consecutive tests of the 1.2532 level when the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a market reversal downward. A decline toward the opposing levels of 1.2514 and 1.2478 can be expected.

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.