Analysis of Trades and Trading Tips for the British Pound

The first test of the 1.2409 level in the second half of the day occurred when the MACD indicator had already moved significantly below the zero mark. In the context of the pound's uptrend, this reduced the likelihood of further declines. Shortly after, the second test of this level took place with the MACD in the oversold zone, allowing Scenario #2 for buying to materialize, which led to a growth of over 80 pips.

Weak data on the US economy, published on Friday, caused a wave of disappointment among traders, which in turn affected market sentiment. Expectations regarding further activity in the services sector did not come true, which led to a weakening of the dollar and an increase in the attractiveness of other currencies, including the pound sterling. The strengthening of the pound against the backdrop of this news was an obvious sign of its resilience and the market's desire to seek more stable assets.

Today, no significant economic data is scheduled. Given the pressure on risk assets observed since the Asian session, it is advisable to exercise caution when buying the pound. It may be best to wait for a deeper correction before making decisions that aim to further develop the uptrend.

Regarding the intraday strategy, I will primarily focus on executing Scenario #1 and Scenario #2.

Buy Signal

Scenario #1: Today, I plan to buy the pound when the price reaches 1.2462 (green line on the chart) with a target of 1.2508 (thicker green line on the chart). At 1.2508, I will exit the buy positions and open sell positions in the opposite direction (expecting a movement of 30–35 pips downward from this level). The pound's growth can be expected as the uptrend continues. Important! Before buying, ensure that the MACD indicator is above the zero mark and beginning to rise.

Scenario #2: I also plan to buy the pound today if there are two consecutive tests of the 1.2439 level, with the MACD indicator in the oversold zone. This will limit the pair's downside potential and trigger an upward market reversal. Growth toward the 1.2462 and 1.2508 levels can be expected.

Sell Signal

Scenario #1: I plan to sell the pound after it breaks below 1.2439 (red line on the chart), which would lead to a quick decline. The key target for sellers will be 1.2404, where I plan to exit the sell positions and immediately open buy positions in the opposite direction (expecting a 20–25 pip movement upward from this level). Selling the pound is better at higher levels since trading would be against the trend. Important! Before selling, ensure that the MACD indicator is below the zero mark and beginning to decline.

Scenario #2: I also plan to sell the pound today if there are two consecutive tests of the 1.2462 level, with the MACD indicator in the overbought zone. This will limit the pair's upside potential and trigger a market reversal downward. A decline toward the 1.2439 and 1.2404 levels 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.