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Analysis of transactions in the GBP / USD pair
Pound tested 1.153 at a time when the MACD line was far from zero, which limited the upside potential of the pair. Sometime later, it tested 1.1495, but this time the MACD line was moving below zero, which was a good signal to sell. This led to a price decrease of around 25 pips.
The lack of statistics in the UK did not stop sellers from continuing to push GBP/USD down, sending it straight to yearly lows. But US data on retail sales put pressure on dollar, so the pair rose for a while before dropping down again to a daily low.
Today, data on UK retails sales will be released, which could lead to a surge in volatility provided that the figure is worse than expected. Most likely, it will put pressure on pound and prompt a new wave of decline in GBP/USD. There is nothing important in the afternoon except for the report on consumer sentiment and inflation expectations in the US. Growth is expected, but it is unlikely to affect the market. This means that trading will remain in a narrow sideways channel until the end of the week.
For long positions:
Buy pound when the quote reaches 1.1474 (green line on the chart) and take profit at the price of 1.1510 (thicker green line on the chart). Growth will occur if the retail sales data in the UK exceed expectations.
Take note that when buying, the MACD line should be above zero or is starting to rise from it. Pound can also be bought at 1.1455, but the MACD line should be in the oversold area as only by that will the market reverse to 1.1474 and 1.1510.
For short positions:
Sell pound when the quote reaches 1.1455 (red line on the chart) and take profit at the price of 1.1414. Pressure will continue if statistics in the UK come out weak, while the US' is much better than expected.
Take note that when selling, the MACD line should be below zero or is starting to move down from it. Pound can also be sold at 1.1474, but the MACD line should be in the overbought area, as only by that will the market reverse to 1.1455 and 1.1414.
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 decision based on the current market situation is an inherently losing strategy for an intraday trader.
InstaForex analytical reviews will make you fully aware of market trends! Being an InstaForex client, you are provided with a large number of free services for efficient trading.
