Trade analysis and tips for trading the British pound

The price test at 1.3489 occurred when the MACD indicator had already moved significantly downward from the zero mark, which limited the pair's downward potential. For this reason, I did not sell the pound.

The further dynamics of GBP/USD will largely be determined by a combination of U.S. macroeconomic factors, with primary importance given to the Personal Consumption Expenditures (PCE) index and the goods trade balance. Special attention will also be directed to data on U.S. household spending, which reflects consumer confidence and willingness to spend. Rising expenditures often signal optimism and confidence in the future, which supports economic growth. However, excessive spending not backed by corresponding income growth may lead to financial instability. Data on household income levels, in turn, serve as an important indicator of purchasing power and financial well-being.

In addition to the above reports, it will also be interesting to see how traders react to the University of Michigan Consumer Sentiment Index, which provides valuable insights into how consumers view the current economy and their personal outlook. This index is a leading indicator that predicts future consumer spending and overall economic activity. Equally important are inflation expectations, which reflect the views of consumers and businesses regarding future inflation trends.

As for the intraday strategy, I will rely mainly on Scenarios No. 1 and No. 2.

Buy Signal

Scenario No. 1: I plan to buy the pound today at the entry point around 1.3469 (green line on the chart) with a target of 1.3501 (thicker green line on the chart). Around 1.3501, I will exit long positions and open shorts in the opposite direction (expecting a 30–35-point move from the level). A strong pound rally today can be expected after weak U.S. data.Important! Before buying, make sure the MACD indicator is above the zero mark and just beginning its upward move.

Scenario No. 2: I also plan to buy the pound today in the event of two consecutive tests of 1.3450 when the MACD indicator is in the oversold zone. This will limit the pair's downward potential and lead to a market reversal upward. Growth toward the opposite levels of 1.3469 and 1.3501 can then be expected.

Sell Signal

Scenario No. 1: I plan to sell the pound today after breaking below 1.3450 (red line on the chart), which will trigger a quick decline in the pair. The key target for sellers will be 1.3414, where I will exit shorts and immediately open long positions in the opposite direction (expecting a 20–25-point move from the level). Sellers can push the pound lower if the data turns out strong.Important! Before selling, make sure the MACD indicator is below the zero mark and just beginning its downward move.

Scenario No. 2: I also plan to sell the pound today in the event of two consecutive tests of 1.3469 when the MACD indicator is in the overbought zone. This will limit the pair's upward potential and lead to a reversal downward. A decline toward the opposite levels of 1.3450 and 1.3414 can then be expected.

What's on the chart:

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

Important. Beginner Forex traders should be very cautious when making market entry decisions. Before the release of major fundamental reports, it is best to stay out of the market to avoid sharp price swings. If you decide to trade during news releases, always place stop orders to minimize losses. Without stop orders, you can very quickly lose your entire deposit, especially if you do not use money management and trade large volumes.

And remember: for successful trading, it is essential to have a clear trading plan like the one presented above. Making spontaneous decisions based on the current market situation is, from the start, a losing strategy for intraday traders.