Trade Analysis and Advice for Trading the British Pound

The price test at 1.3350 occurred at a moment when the MACD indicator had moved far below the zero line, which limited the pair's downward potential. For this reason, I did not sell the pound.

The absence of UK economic data maintained pressure on the pair. Later in the day, traders will likely focus on the U.S. initial jobless claims data and the speech by FOMC member Lisa D. Cook. The number of initial jobless claims is one of the leading indicators of the labor market. Typically, a decrease in this figure indicates economic strengthening and job growth, which is positive for the U.S. dollar and negative for the pound.

FOMC member Lisa D. Cook's speech is the second key point of attention. Members of the Federal Reserve play a decisive role in shaping U.S. monetary policy, which directly impacts the global economy. Any hints at future interest rate changes, possibly driven by sharp increases in energy prices, will be of particular interest—this is also positive for the dollar.

Regarding intraday strategy, I will primarily rely on scenarios #1 and #2.

Buy Signal

Scenario #1: I plan to buy the pound today at the entry point around 1.3363 (green line on the chart) with a target of 1.3396 (thicker green line on the chart). Around 1.3396, I will exit long positions and open short positions in the opposite direction (expecting a 30–35 point move in the opposite direction from that level). Today, the pound can be expected to rise following weak U.S. data. Important! Before buying, make sure the MACD indicator is above zero and just start its upward move from that level.

Scenario #2: I also plan to buy the pound today if the price tests 1.3343 twice consecutively while the MACD indicator is in the oversold zone. This will limit the pair's downward potential and trigger a reversal upward. Growth toward the opposite levels of 1.3363 and 1.3396 can be expected.

Sell Signal

Scenario #1: I plan to sell the pound today after the 1.3343 level is broken (red line on the chart), which should lead to a rapid decline. The key target for sellers is 1.3312, where I will exit short positions and immediately open long positions in the opposite direction (expecting a 20–25 point move in the opposite direction from that level). Pressure on the pound can return at any moment today. Important! Before selling, make sure the MACD indicator is below zero and just start its downward move from that level.

Scenario #2: I also plan to sell the pound today if the price tests 1.3363 twice consecutively 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 the opposite levels of 1.3343 and 1.3312 can be expected.

Chart Key:

• Thin green line – entry price for buying the instrument.
• Thick green line – estimated target for taking profit or manually closing positions, as further growth above this level is unlikely.
• Thin red line – entry price for selling the instrument.
• Thick red line – estimated target for taking profit or manually closing positions, as further decline below this level is unlikely.
• MACD indicator – when entering the market, pay attention to overbought and oversold zones.

Important: Beginner Forex traders must make entry decisions very carefully. It's best to stay out of the market before major fundamental reports to avoid sharp price swings. If you decide to trade during news releases, always set stop-loss orders to minimize losses. Without stop-losses, you can quickly lose your entire deposit, especially if you don't practice proper money management and trade large volumes.

Remember, successful trading requires a clear trading plan, like the one I presented above. Making spontaneous trading decisions based solely on current market conditions is a losing strategy for intraday traders.