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The test of the price at 1.3517 occurred when the MACD indicator was just starting to move upwards from the zero mark, confirming the correct entry point for buying pounds. As a result, the pair rose to the target level of 1.3553.
The developments regarding Trump's introduction of new 15% trade tariffs continue to pressure the dollar, strengthening demand for the British pound. These protectionist measures have already raised significant concerns in global markets, sparking fears of a trade war and a slowing global economy. In such an uncertain environment, investors have turned their attention to the British currency as an alternative asset.
However, today the focus of market participants will be on Clare Lombardelli's speech as Deputy Governor of the Bank of England on monetary policy issues. Her speech, scheduled for the first half of the day, could significantly influence the GBP/USD pair, potentially weakening it. Traders tracking the dynamics of GBP/USD will be particularly interested in Lombardelli's remarks regarding inflationary processes and the labor market, which has been facing serious challenges recently. Any suggestions about the potential easing of the BoE's measures will be perceived by the market as a significant factor that could change the currency pair's direction.
As for the intraday strategy, I will focus more on implementing scenarios #1 and #2.
Scenario #1: I plan to buy the pound today when it reaches an entry point around 1.3567 (green line on the chart), targeting a move to 1.3596 (thicker green line on the chart). At the level of 1.3596, I intend to exit the long positions and open shorts back in the opposite direction (aiming for a movement of 30-35 pips in the opposite direction from the level). Expecting growth for the pound today is feasible amid a continuing trend. Important! Before buying, ensure the MACD indicator is above the zero mark and just beginning to rise from it.
Scenario #2: I also plan to buy the pound today in case of two consecutive tests of the price at 1.3545 when the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to a market reversal upwards. One can expect growth to opposing levels of 1.3567 and 1.3596.
Scenario #1: I plan to sell the pound today after the level at 1.3545 (red line on the chart) is reached, which will trigger a rapid decline in the pair. The key target for sellers will be 1.3526, where I intend to exit the shorts and immediately buy back in the opposite direction (aiming for a movement of 20-25 pips in the opposite direction from the level). Sellers of the pound will emerge after the weekly high is updated. Important! Before selling, ensure the MACD indicator is below the zero mark and just beginning to decline from it.
Scenario #2: I also plan to sell the pound today if the price tests 1.3567 twice in a row while the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a market reversal downwards. One can expect a decline to opposing levels at 1.3545 and 1.3526.
Beginner traders in the Forex market must make entry decisions very cautiously. It is best to stay out of the market before significant fundamental reports are released to avoid sudden price fluctuations. If you decide to trade during news releases, always set stop orders to minimize losses. Without stop orders, you can quickly lose your entire deposit, especially if you do not use money management and trade large volumes.
Remember, to trade successfully, you must have a clear trading plan, as presented above. Spontaneous trading decisions based on the current market situation are a losing strategy for intraday traders.