Trade Review and Guidance for Trading the British Pound

The test of the 1.3230 level occurred when the MACD indicator had already moved well above the zero line, which limited the pound's upward potential. For this reason, I didn't buy. No other entry points appeared after that.

The lack of UK news affected the pound's volatility, so the focus now shifts to U.S. data. Investors are waiting for fresh economic releases that could shed light on the state of the U.S. economy and, consequently, the Federal Reserve's future actions. Any hint of labor market weakness could trigger dollar selling and lift the pound. On the other hand, strong figures would support the Fed's hawkish stance, negatively impacting the British currency. A decrease in initial jobless claims would signal labor market strength. An increase in building permits and housing starts would point to a recovery in the housing sector, which could be interpreted as a sign of a healthy economy and lead traders to buy the dollar. Geopolitical risks should also not be ignored, as they can trigger market volatility and influence the pound's performance at any moment.

For today's intraday strategy, I'll primarily rely on Scenarios #1 and #2.

Buy Signal

Scenario #1: I plan to buy the pound today when the price reaches 1.3249 (thin green line on the chart), targeting a rise toward 1.3295 (thicker green line). Around 1.3295, I plan to exit long positions and open shorts in the opposite direction (targeting a 30–35 point move downward). A continuation of the bullish trend would support pound buying today.Important: Before entering a long position, ensure the MACD indicator is above the zero line and just beginning to rise.

Scenario #2: I also plan to buy the pound in the event of two consecutive tests of the 1.3220 level, while MACD is in the oversold zone. This would limit the pair's downside and trigger a reversal. The targets would be 1.3249 and 1.3295.

Sell Signal

Scenario #1: I plan to sell the pound after a drop to 1.3220 (thin red line), targeting 1.3171. At this level, I will exit shorts and consider long positions in the opposite direction (aiming for a 20–25 point rebound). Strong U.S. data could revive bearish momentum.Important: Before selling, ensure the MACD indicator is below the zero line and just beginning to fall.

Scenario #2: I also plan to sell the pound if there are two consecutive tests of 1.3249, with MACD in the overbought area. This would limit the pair's upside and cause a downward reversal. The targets in this case would be 1.3220 and 1.3171.

What's on the Chart:

• Thin green line – Entry price for buying the trading instrument
• Thick green line – Suggested Take Profit level or area to manually close long positions, as growth beyond this point is less likely
• Thin red line – Entry price for selling the trading instrument
• Thick red line – Suggested Take Profit level or area to manually close short positions, as further decline below this level is unlikely
• MACD Indicator – When entering trades, it's important to monitor overbought and oversold zones

Important for Beginner Traders:

If you're new to Forex, be very cautious when deciding to enter the market. It's often best to stay out before major economic reports to avoid getting caught in sharp volatility. If you do trade during news releases, always use stop-loss orders to limit potential losses. Without stop-losses, especially when trading large volumes without proper money management, your entire deposit could be wiped out very quickly.

Remember: successful trading requires a well-defined trading plan like the one outlined above. Making spontaneous decisions based on short-term market conditions is a losing strategy for intraday traders.