Friday Trade Review:

1-Hour Chart of GBP/USD

The GBP/USD pair showed a slight downward movement on Friday amidst easing tensions between China and the United States. It is also worth noting that over the weekend, the United States witnessed its third protest against Donald Trump's immigration and trade policies, with this one being the largest by far. Demonstrations took place in more than 2,600 cities across America, and not all of them were peaceful or orderly.

As we can see, America is rebelling against Donald Trump, which is quite logical considering both his foreign and domestic policies. Consequently, we continue to believe that with Trump at the helm, America is heading into decline. Many central banks are already moving away from using the U.S. dollar as a reserve currency. People are already leaving America. And it is already evident that doing business with the U.S. will become increasingly difficult in the coming years. Therefore, we foresee further decline for the dollar.

5-Minute Chart of GBP/USD

On the 5-minute timeframe, three trading signals were formed on Friday. All three were false, as the price movement throughout the day was very weak. The price generated signals three times in the 1.3413–1.3421 area but failed to move even 20 pips in the desired direction. As a reminder, no matter how good trading signals are, if volatility is near zero, making a profit is impossible.

How to Trade on Monday:

On the hourly timeframe, the GBP/USD pair has finally begun forming a new bullish trend, which could mark the start of a new leg in the global uptrend. As previously mentioned, there are no fundamental reasons for a sustained dollar rally, so in the medium term, we expect the dollar to move only to the upside. Donald Trump's policy, which has sharply intensified regarding tariffs in recent weeks, will continue to drive the market away from the U.S. dollar.

On Monday, the GBP/USD pair may attempt to continue its upward movement, as the trend has shifted to bullish. A bounce from the 1.3413–1.3421 zone would allow for opening long positions with targets at 1.3466–1.3475. A consolidation of price below the 1.3413–1.3421 area would indicate a new phase of downward correction.

On the 5-minute timeframe, trading can now be conducted around the following levels: 1.3102–1.3107, 1.3203–1.3211, 1.3259, 1.3329–1.3331, 1.3413–1.3421, 1.3466–1.3475, 1.3529–1.3543, 1.3574–1.3590, 1.3643–1.3652, 1.3682, 1.3763. On Monday, no significant events or reports are scheduled in either the United Kingdom or the United States. As a result, there will be little for traders to respond to throughout the day, and volatility may once again remain low.

Main Rules of the Trading System:

1. Signal strength is determined by how quickly the signal is formed (rebound or breakout of a level). The less time it took, the stronger the signal.
2. If two or more false signal trades were opened near a certain level, all subsequent signals from that level should be ignored.
3. During flat market conditions, any pair may generate many false signals or none at all. In any case, trading is best avoided at the first signs of a flat market.
4. Trades should be opened between the start of the European session and the middle of the U.S. session; all trades should be closed manually afterward.
5. On the hourly timeframe, signals from the MACD indicator should only be traded when there is sufficient volatility and an established trend confirmed by a trendline or trend channel.
6. If two levels are located too close (5 to 20 pips apart), treat them as a single support or resistance zone.
7. After a trade has moved 20 pips in the correct direction, set the Stop Loss to breakeven.

What's on the Charts:

• Support and Resistance Price Levels – levels that serve as targets for opening buy and sell trades. Take Profit levels can be placed near them.
• Red Lines – trendlines or trend channels that display the current trend direction and indicate the preferred trading direction.
• MACD Indicator (14,22,3) – histogram and signal line – an auxiliary indicator that can also be used as a source of signals.

Important speeches and reports (always shown in the news calendar) can significantly impact currency pair movements. Therefore, during their release, it's best to trade with extreme caution or exit the market entirely to avoid sharp reversals against the preceding trend.

Beginner forex traders should remember that not every trade can be profitable. Developing a clear strategy and using proper money management are key to long-term trading success.