29.05.202309:02 Forex Analysis & Reviews: Analysis and trading tips for GBP/USD on May 29

Analysis of transactions and tips for trading GBP/USD

The price test of 1.2385, coinciding with the time that the MACD line was already far from zero, limited the upward potential of the pair. Sometime later, another test occurred, and this time the MACD line was in the overbought area, providing an opportunity to sell. This resulted in a dip of over 40 pips.

The issue of raising the US debt ceiling has been resolved, and only technical details remain. This is a good reason to buy pound in anticipation of an upward correction. However, the economic calendar is empty today, so there is no UK data that could further support buyers. This means that the pair could dip after unsuccessful attempts to reach the highs of last Friday.

For long positions:

Buy pound when the level of 1.2383 (green line on the chart) is reached and take profit at the price of 1.2412 (thicker green line on the chart). Growth could occur, but it will only be a correction. Nevertheless, when buying, traders should make sure that the MACD line is above zero or is starting to rise from it. Pound can also be bought after two consecutive price tests of 1.2350, but the MACD line should be in the oversold area as only by that will the market reverse to 1.2383 and 1.2412.

For short positions:

Sell pound when the level of 1.2350 (red line on the chart) is reached and take profit at the price of 1.2311. Pressure could intensify to the extent that the price will return to monthly lows. However, when selling, traders should make sure that the MACD line is below zero or is starting to move down from it. Pound can also be sold after two consecutive price tests of 1.2383, but the MACD line should be in the overbought area as only by that will the market reverse to 1.2350 and 1.2311.

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.