Analysis of previous deals:
30M chart of the GBP/USD pair
The GBP/USD pair on the 30-minute timeframe continued to trade very indistinctly on April 28, in different directions, without a definite direction and with low volatility. And so, trading was not very comfortable during the day. The pair's quotes left the rising channel on the current timeframe, however, a new downward movement did not start. This point is very important and novice traders should understand it. The quotes left the rising channel not because the downward movement began, but because the upward movement ended and the sideways movement began, that is, flat. It has been observed in the last three days. The price did not even manage to update the last local low today. Therefore, it is incorrect to speak about starting a downward trend now. Hence the conclusion: one should have considered buy signals from the MACD indicator. Three of them were formed during the day. And all three formed well below zero, so all three had to be skipped. Therefore, positions should not have been opened on this timeframe during the day. No important macroeconomic report or event for the day. The results of the Federal Reserve meeting was just announced a few hours ago, and, as we see, so far the reaction to this event is very weak. Perhaps it will get stronger during Fed Chairman Jerome Powell's press conference.
5M chart of the GBP/USD pair
Three trading signals on the 5-minute timeframe were formed during the day, and all of them are surprisingly accurate and recommended to work out. All three signals are to buy, and all three are a rebound from the 1.3865 level. If in the first case the price went up by only 20 points, which was enough to set Stop Loss at breakeven, at which the deal was closed, then the upward movement was even weaker the second time. But at the same time, Stop Loss was not placed, and the price did not settle below the 1.3865 level, so the long position remained open when the third rebound from the 1.3865 level occurred, afterwards the upward movement began. In total, the pound/dollar pair went up by around 48 points, which was enough for Take Profit. And so, novice traders could earn at least 40 points. Moreover, it was possible to get out of this deal a few hours before the results of the Fed meeting began to be summed up, which is just fine, since novice traders did not have to risk in vain. At this point, all trades should be closed.
How to trade on Thursday:
On Thursday, we recommend trading again according to the upward trend on the 30-minute timeframe. Despite the fact that the pair has left the rising channel, the upward trend continues. So tomorrow it will be necessary to wait for new buy signals in the form of upward reversals of the MACD indicator. The indicator climbed far up today, so you need to wait for a downward correction. You also need to be clear about how the markets will react to Powell's press conference. In general, you will need to look at tomorrow morning's picture with a new look. The US is set to publish a report on GDP for the first quarter, which could provoke serious movements, especially if its actual value differs greatly from the forecast. The important levels on the 5 minute timeframe are 1.3838, 1.3865, 1.3928 and 1.3947. The price can bounce off them or overcome them. As before, Take Profit is set at a distance of 40-50 points on a 30-minute timeframe, the target on the 5-minute timeframe is the closest level (if it is located more than 20 points). If the nearest level is too far away, then it is recommended to maintain the deal in manual mode, tracking changes in the market. When passing 20 points in the right direction, we recommend setting Stop Loss to breakeven.
On the chart:
Support and Resistance Levels are the Levels that serve as targets when buying or selling the pair. You can place Take Profit near these levels.
Red lines are the channels or trend lines that display the current trend and show in which direction it is better to trade now.
Up/down arrows show where you should sell or buy after reaching or breaking through particular levels.
The MACD indicator consists of a histogram and a signal line. When they cross, this is a signal to enter the market. It is recommended to use this indicator in combination with trend lines (channels and trend lines).
Important announcements and economic reports that you can always find in the news calendar can seriously influence the trajectory of a currency pair. Therefore, at the time of their release, we recommended trading as carefully as possible or exit the market in order to avoid a sharp price reversal.
Beginners on Forex should remember that not every single trade has to be profitable. The development of a clear strategy and money management are the key to success in trading over a long period of time.
