Analysis of Trades and Trading Tips for the British Pound

The price test at 1.3502 occurred in the afternoon when the MACD indicator had already moved significantly downward from the zero mark, limiting the pair's downside potential. For this reason, I did not sell the pound.

Donald Trump's latest manipulations with trade tariffs have limited the pound's upward potential and strengthened the dollar. The unpredictability of U.S. trade policy, characterized by abrupt changes and statements, has a destabilizing effect on global markets, prompting investors to seek refuge in safer currencies, particularly the U.S. dollar. Markets react painfully to any hints of new trade barriers as they inevitably lead to a decline in global trade and economic growth. The British pound, in turn, remains vulnerable due to uncertainties surrounding future economic growth rates—especially since the Bank of England is not rushing to lower interest rates.

Today, in the first half of the day, we expect service sector PMI and composite PMI data for the UK. Weak figures will intensify pressure on the GBP/USD pair. A drop in the PMI indices below expected levels could confirm fears of an economic slowdown, which would reduce demand for the pound.

For intraday strategy, I will focus primarily on Scenarios #1 and #2.

Buy Scenario

Scenario #1: I plan to buy the pound today if the entry point around 1.3526 (green line on the chart) is reached, targeting a rise to 1.3573 (thicker green line on the chart). Around 1.3573, I plan to exit purchases and open sales on a reversal (expecting a 30–35 pip move in the opposite direction). A substantial rise in the pound can only be expected after strong data.

Important: Before buying, ensure the MACD indicator is above the zero mark and beginning to rise.

Scenario #2: I also plan to buy the pound today in case of two consecutive tests of the 1.3496 level when the MACD indicator is in the oversold zone. This will limit the pair's downside potential and trigger an upward market reversal. Growth toward 1.3526 and 1.3573 can be expected.

Sell Scenario

Scenario #1: I plan to sell the pound today after the 1.3496 level (red line on the chart) is updated, which will lead to a quick decline in the pair. The sellers' key target will be the 1.3458 level, where I plan to exit sales and immediately open purchases on a reversal (expecting a 20–25-pip move in the opposite direction). Selling the pound is possible after an unsuccessful attempt to break out above the daily high.

Important: Before selling, ensure the MACD indicator is below the zero mark and just beginning to decline.

Scenario #2: I also plan to sell the pound today in case of two consecutive tests of the 1.3526 level when the MACD indicator is in the overbought zone. This will limit the pair's upward potential and trigger a market reversal downward. A decline toward 1.3496 and 1.3458 can be expected.

What's on the Chart:

• The thin green line represents the entry price where the trading instrument can be bought.
• The thick green line indicates the expected price level where a Take Profit order can be placed, or profits can be manually secured, as further price growth above this level is unlikely.
• The thin red line represents the entry price where the trading instrument can be sold.
• The thick red line indicates the expected price level where a Take Profit order can be placed, or profits can be manually secured, as further price decline below this level is unlikely.
• The MACD indicator should be used to assess overbought and oversold zones when entering the market.

Important Notes:

• Beginner Forex traders should exercise extreme caution when making market entry decisions. It is advisable to stay out of the market before the release of important fundamental reports to avoid exposure to sharp price fluctuations. If you choose to trade during news releases, always use stop-loss orders to minimize potential losses. Trading without stop-loss orders can quickly wipe out your entire deposit, especially if you neglect money management principles and trade with high volumes.
• Remember, successful trading requires a well-defined trading plan, similar to the one outlined above. Making impulsive trading decisions based on the current market situation is a losing strategy for intraday traders.