Analysis of Trades and Trading Tips for the British Pound

The test of the 1.3357 price level occurred when the MACD indicator had just started moving downward from the zero line, confirming a correct entry point for selling the pound, which resulted in a decline of over 50 pips.

The Federal Reserve's decision to leave interest rates unchanged at 4.50%, along with Chair Jerome Powell's inclination toward a more restrictive policy, led to a stronger dollar and a weaker pound. The British pound also faces additional pressure due to uncertainty over the UK's future economic policy. Concerns about a recession and a more aggressive rate-cutting cycle are acting as a restraining factor for the pound. Overall, the balance of power between the dollar and the pound is shaped by a range of factors, including central bank monetary policies, economic outlooks, and political stability. In the near term, the market will closely monitor upcoming data and the central bank's statements to assess the further direction of currency pairs. In the short run, the dollar is likely to maintain its strength against the pound, particularly as there are no economic reports scheduled from the UK today.

In the absence of key economic data, market focus will shift to technical factors and investor sentiment. As seen yesterday, the pound may see a slight upward correction, but further moves will depend on U.S. data.

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

Buy Scenario

Scenario #1: Today, I plan to buy the pound upon reaching the entry point around 1.3279 (green line on the chart), targeting a rise to 1.3309 (thicker green line on the chart). Around 1.3309, I intend to exit long positions and open short positions in the opposite direction, expecting a 30–35 pip pullback from that level. Any upside in the pound today should be seen as a corrective move.

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

Scenario #2: I also plan to buy the pound today in the event of two consecutive tests of the 1.3254 level, when the MACD indicator is in the oversold area. This will limit the pair's downside potential and trigger a market reversal upward. A rise toward 1.3279 and 1.3309 can then be expected.

Sell Scenario

Scenario #1: Today, I plan to sell the pound after a breakout below 1.3254 (red line on the chart), which would lead to a rapid decline in the pair. The key target for sellers will be 1.3203, where I plan to exit short positions and immediately open long positions in the opposite direction (expecting a 20–25 pip rebound from that level). Selling the pound today can be done in continuation of the current downtrend.

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

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.