06.07.202108:14 Forex Analysis & Reviews: Analysis and trading recommendations for GBP/USD on July 6

Analysis of transactions in the GBP / USD pair

Volatility was low on Monday because it was weekend in the US, not to mention they were celebrating "Independence Day". As a result, only one signal was formed in GBP / USD, and this was to buy at 1.3848. However, it had to be ignored because it came when the MACD line was at the overbought area.

Trading recommendations for July 6

Pay attention to the upcoming PMI report for the UK construction sector as such will certainly have a significant effect on the market. A good performance will lead to a rally in GBP / USD, while a weaker-than-expected figure will set off another decline in the pair. Lately, this indicator has been showing stunning results amid the opening of the economy and access to cheap money, which is driving real estate prices up in UK

At the same time, data on mortgage loans will also be issued, which, if posts good growth, will lead to a further increase in the pair. But in the afternoon, the market may be swayed amid reports on US services PMI and economic optimism index.

For long positions:

Open a long position when pound reaches 1.3890 (green line on the chart), and then take profit at the level of 1.3964 (thicker green line on the chart). Growth may occur if UK releases strong PMI data for the construction sector. But before buying, make sure that the MACD line is above zero, or is starting to rise from it.

For short positions:

Open a short position when pound reaches 1.3850 (red line on the chart), and then take profit at the level of 1.3791. GBP / USD will come under pressure if activity in UK construction sector slows. But before selling, make sure that the MACD line is below zero, or is starting to move down from it.

What's on the chart:

The thin green line is the key level at which you can place long positions in the GBP / USD pair.

The thick green line is the target price, since the quote is unlikely to move above this level.

The thin red line is the level at which you can place short positions in the GBP / USD pair.

The thick red line is the target price, since the quote is unlikely to move below this level.

MACD line - when entering the market, it is important to be guided by the overbought and oversold zones.

Important: Novice traders need to be very careful when making decisions about entering the market. Before the release of important reports, it is best to stay out of the market to avoid being caught in sharp fluctuations in the rate. If you decide to trade during the release of news, then always place stop orders to minimize losses. Without placing stop orders, you can very quickly lose your entire deposit, especially if you do not use money management and trade large volumes.

And remember that for successful trading, you need to have a clear trading plan. Spontaneous trading decisions based on the current market situation is an inherently losing strategy for an intraday trader.