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The test of 1.2353 coincided with the time when the MACD line was just starting to move up from zero, which was a signal to buy. However, the pair only increased by 10 pips. Another test with a similar setup allowed a profit of over 30 pips.
Ahead is data on US GDP for the first quarter, as well as a weekly report on jobless claims. An increase in the latter will weaken the positions of dollar and lead to a further correction in pound. Growth in pending home sales will also be a negative factor for dollar. However, the deadlock in the issue of US debt ceiling is likely to hamper the upward potential in GBP/USD.
For long positions:
Buy pound when the quote reaches 1.2385 (green line on the chart) and take profit at the price of 1.2422 (thicker green line on the chart). Growth is likely to occur amid positive news related to US government debt. However, before buying, make sure that the MACD line is above zero and is starting to rise from it. Pound can also be bought after the level of 1.2360 is tested twice, but the MACD line should be in the oversold area as only by that will the market reverse to 1.2385 and 1.2422.
For short positions:
Sell pound when the quote reaches 1.2360 (red line on the chart) and take profit at the price of 1.2324. Pressure may continue without significant fundamental reasons. However, before selling, make sure that the MACD line is below zero and is starting to drop down from it. Pound can also be sold after the level of 1.2385 is tested twice, but the MACD line should be in the overbought area as only by that will the market reverse to 1.2360 and 1.2324.
What's on the chart:
Thin green line - entry price at which you can buy GBP/USD
Thick green line - estimated price where you can set Take-Profit (TP) or manually fix profits, as further growth above this level is unlikely.
Thin red line - entry price at which you can sell GBP/USD
Thick red line - estimated price where you can set Take-Profit (TP) or manually fix profits, as further decline below this level is unlikely.
MACD line- it is important to be guided by overbought and oversold areas when entering the market
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.
