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We also have a pronounced upward trend for the GBP/USD pair, which means that now we need to strictly trade upward (purchases, buy positions). We have an upward trend line marked on the chart that continues to support bull traders. The price cannot go below this line yet, so you are not advised to sell the pair now. At the same time, the MACD indicator clearly shows each new entry into a new round of the upward movement. There are no sellers on the market now, as the pair fails to even normally correct by itself (movement against the main trend is an integral part of any trend).
No new and important news from the UK on Monday and Tuesday. There were no economic reports either. There was only a message from Michel Barnier, who is in talks with London on a comprehensive deal that will operate between the UK and the European Union after the end of the transition period on December 31, 2020. The message is: "The deal with London is still possible." Why is it important? In recent years, buyers of the British pound are hoping that the UK will leave the EU with a deal. If there is no deal, it will hit both economies very hard, so it is important that there is an agreement. The agreement will enable Britain and the EU to maintain some ties with each other that are useful and important. Thus, if the main negotiator says that a deal is still possible, this is positive news for the pound, although, in fact, it does not mean anything other than the expectations of the European side. The following economic reports will appear on Britain's news calendar on Wednesday, July 29: changes in the volume of the aggregate M4 of the money supply, the number of approved applications for mortgage loans, the volume of net loans to individuals. We can immediately note that all these reports are extremely weak and the markets never react to them (or the reaction is not noticeable, since it is minimal). The same applies to all the news planned in America, except for the results of the Federal Reserve meeting and the summing up at a press conference. A lot of interesting things can be heard at the press conference, in particular the central bank's plans for further actions, forecasts for economic growth, unemployment, inflation and other important indicators.
The following scenarios are possible on July 29:
1) If the MACD indicator provides a buy signal during the day (so far there is a signal for a correction, circled in a red circle), then we will recommend buying the pound/dollar pair again with targets at the levels of 1.2985 and 1.3026. When this signal is formed, the price should be located strictly above the trend line.
2) But sales, from our point of view, can only be considered after the price consolidates below the trend line. In this case, the trend will change to a downward one and the initiative will go to sellers. The targets for sales will be the levels 1.2796 and 1.2755.
What's on the chart:
Support and Resistance Price Levels - Levels that are targets when buying or selling. You can place Take Profit levels near them.
Red lines - channels or trend lines that display the current trend and show which direction it is preferable to trade now.
Arrows up/down - indicate when you reach or overcome which obstacles you should trade up or down.
MACD indicator is a histogram and a signal line, the crossing of which is a signal to enter the market. It is recommended to use in combination with trend lines (channels, trend lines).
Important speeches and reports (always contained in the news calendar) can greatly influence the movement of a currency pair. Therefore, during their exit, it is recommended to trade as carefully as possible or exit the market in order to avoid a sharp price reversal against the previous movement.
Beginners in the forex market should remember that every trade cannot be profitable. The development of a clear strategy and money management are the key to success in trading over a long period of time.
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