Trade Review and Tips for Trading the British Pound

The price test of 1.3520 coincided with the moment when the MACD indicator had just started moving upward from the zero line, which confirmed a correct entry point for buying the pound. However, the pair did not show further growth.

In the second half of the day, strong data on the growth of U.S. new home sales will support the dollar and lead to a decline in GBP/USD. Investors are likely to react to positive economic signals from the U.S., redirecting assets toward the American currency. Increased demand for newly built homes in the U.S. generally indicates an overall improvement in economic conditions and higher consumer confidence. This, in turn, stimulates capital inflows into U.S. assets, making the dollar more attractive to international investors. From a technical perspective, a breakdown of key GBP/USD support levels triggered by strong U.S. data could reinforce the downward trend observed during the European session. In the short term, if the housing sales data significantly exceed forecasts, further strengthening of the dollar and continued GBP/USD decline should be expected.

As for intraday strategy, I will focus mainly on implementing Scenario #1 and Scenario #2.

Buy Signal

Scenario #1: I plan to buy the pound today if the entry point is reached around 1.3527 (green line on the chart), with a growth target at 1.3560 (thicker green line on the chart). At 1.3560, I will exit long positions and open sales in the opposite direction (expecting a 30–35 point move back from that level). A strong rise in the pound today is unlikely. Important: Before buying, make sure the MACD indicator is above the zero line and just beginning its upward move.

Scenario #2: I also plan to buy the pound today if the price at 1.3488 is tested twice while the MACD indicator is in the oversold zone. This will limit the pair's downward potential and trigger a reversal upward. Growth can be expected toward the opposite levels of 1.3527 and 1.3560.

Sell Signal

Scenario #1: I plan to sell the pound today after the price breaks below 1.3488 (red line on the chart), which will lead to a rapid decline of the pair. The key target for sellers will be 1.3458, where I will exit sales and immediately open purchases in the opposite direction (expecting a 20–25 point rebound from that level). Sellers could push the pound lower if U.S. statistics are strong. Important: Before selling, make sure the MACD indicator is below the zero line and just beginning its downward move.

Scenario #2: I also plan to sell the pound today if the price at 1.3527 is tested twice while the MACD indicator is in the overbought zone. This will limit the pair's upward potential and trigger a reversal downward. A decline toward 1.3488 and 1.3458 can then be expected.

Chart Notes

• Thin green line – entry price for buying the instrument.
• Thick green line – projected price for setting Take Profit or manually fixing profits, as further growth above this level is unlikely.
• Thin red line – entry price for selling the instrument.
• Thick red line – projected price for setting Take Profit or manually fixing profits, as further decline below this level is unlikely.
• MACD indicator – when entering the market, it is important to follow overbought and oversold zones.

Important: Beginner Forex traders must be very cautious when making entry decisions. Before the release of important fundamental reports, it is best to stay out of the market to avoid sharp price fluctuations. If you decide to trade during news releases, always place stop-loss orders to minimize losses. Without stop-loss orders, you can very quickly lose your entire deposit, especially if you ignore money management and trade large volumes.

Remember, successful trading requires a clear trading plan, such as the one presented above. Spontaneous decision-making based only on the current market situation is an inherently losing strategy for an intraday trader.