Analysis of previous deals:
30M chart of the GBP/USD pair
The GBP/USD pair was trading down on the 30-minute timeframe on Wednesday. The price tried to settle above the level of 1.4165, but failed. Thus, at the moment, the pair has already approached the May 19 low, but it will be extremely difficult for the pair to go below the level of 1.4081. As we have said in previous articles, the pair broke the upward trend line, so the trend formally changed to a downward trend. However, in reality, the downward trend may not start, because in the last 6-7 days the quotes have been at approximately 120-point horizontal channel. The fact that the price moves more sideways than up or down is clearly visible on both timeframes. It is not in vain that in our last review, we advised ignoring the signals of the MACD indicator. Yesterday, it formed three signals at once, and the pair changed its direction of movement several times during the day and it is unlikely that these signals could have been profitable. Thus, we recommend that you continue not to use MACD signals until a new clear trend is formed.
5M chart of the GBP/USD pair
The GBP/USD pair traded much better than the euro/dollar pair on the 5-minute timeframe, at which novice traders could have gotten a small loss yesterday. The pound only formed two sell signals in the form of rebounds from the level of 1.4171. Both rebounds were as clear as possible, so there was no doubt whether to open a trade near this level or not. In the first case, after forming the signal, the pair went down 29 points, which is exactly 1 point less than necessary for the deal to be closed by Take Profit. In the second case, the pair immediately went down 40 points, which would be enough to make a profit of 30-40 points. And so novice traders could earn exactly 30-40 points during the day, which is very good and neutralizes the losses on the EUR/USD pair. The European trading session is about to open, and the price is located near the level of 1.4110. Therefore, you should be careful, new signals may form. Take note that there was not a single noteworthy report or event in the UK or the US during the day.
Trading tips for Thursday:
The situation on the 30-minute timeframe is confusing at this time, as the upward trend line has been overcome, but the downward movement has not really begun. And the whole picture is becoming more and more like a flat every day. It is because of the flat that the MACD indicator cannot form a strong signal for several days now. It is also unclear which direction it would trade in the flat. Therefore, we recommend temporarily not to track signals from MACD on this timeframe. The important levels on the 5 minute timeframe are 1.4081, 1.4110, 1.4171, 1.4210 and 1.4233. The price can rebound off them or surpass them. As before, we set Take Profit at a distance of 40-50 points. At 5M TF, you can use all the nearest levels as targets, but then you need to take profit, taking into account the strength of the movement. When passing 20 points in the right direction, we recommend setting Stop Loss to breakeven. There are no major events planned for Thursday in the UK, but several important reports will be published in the US, in particular on GDP and orders for durable goods. Therefore, we recommend that you be careful when publishing this data.
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.
