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30.05.2024 03:34 PM
GBP/USD: Simple trading tips for novice traders for May 30th (US session)

Analysis of transactions and tips on trading the British pound

The first test of the price of 1.2704 came at a time when the MACD indicator went up a lot from zero, which limited the upward potential of the pair. After a short period, another test of 1.2704 occurred at a time when the MACD was declining from the overbought area, which was a suitable condition for the implementation of scenario No. 2 for sale. But, alas, it has not yet reached a major drop in the pair. In the afternoon, figures are expected on the change in GDP for the quarter, the main index of personal consumer spending, the price index of GDP, the weekly number of initial applications for unemployment benefits and the balance of foreign trade in goods. Strong data will return pressure on the pair, and weak indicators will push the pound beyond the daily maximum. As for the intraday strategy, I plan to act based on the implementation of scenarios No. 1 and No. 2.

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Buy signal

Scenario No. 1: I plan to buy the pound today when I reach the entry point in the area of 1.2723 (green line on the chart) in order to grow to the level of 1.2767 (thicker green line on the chart). In the area of 1.2767, I will exit purchases and open sales in the opposite direction (counting on a movement of 30-35 points in the opposite direction from the level). The pound's growth today can be counted on to continue the upward trend, but only after weak US GDP data. Important! Before buying, make sure that the MACD indicator is above the zero mark and is just starting to grow from it.

Scenario No. 2: I also plan to buy the pound today in the case of two consecutive price tests of 1.2693, at a time when the MACD indicator will be in the oversold area. This will limit the pair's downward potential and lead to a reverse upward reversal of the market. We can expect growth to the opposite levels of 1.2723 and 1.2767.

A sell signal

Scenario No. 1: I plan to sell the pound today after updating the level of 1.2693 (the red line on the chart), which will lead to a rapid decline in the pair. The key target of sellers will be the 1.2642 level, where I will exit sales, as well as immediately open purchases in the opposite direction (counting on a movement of 20-25 points in the opposite direction from the level). Sellers will show themselves in the event of a lack of buyer activity near the daily high and strong US GDP data. Important! Before selling, make sure that the MACD indicator is below the zero mark and is just starting to fall from it.

Scenario No. 2: I also plan to sell the pound today in the case of two consecutive price tests of 1.2723, at a time when the MACD indicator will be in the overbought area. This will limit the upward potential of the pair and lead to a downward reversal of the market. We can expect a decline to the opposite levels of 1.2693 and 1.2642.

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Chart Explanation:

Thin green line: Entry price for buying the trading instrument.

Thick green line: Expected price where Take Profit can be set, or profit can be taken manually, as further growth above this level is unlikely.

Thin red line: Entry price for selling the trading instrument.

Thick red line: Expected price where Take Profit can be set, or profit can be taken manually, as further decline below this level is unlikely.

MACD Indicator: When entering the market, it is important to use overbought and oversold zones.

Important: Beginner traders in the Forex market need to be very cautious when making entry decisions. It is best to stay out of the market before important fundamental reports are released to avoid sudden price fluctuations. If you decide to trade during news releases, always set stop-loss orders to minimize losses. Without stop-loss orders, you can quickly lose your entire deposit, especially if you do not use money management and trade in large volumes.

Remember that successful trading requires a clear trading plan similar to the one presented above. Making spontaneous trading decisions based on the current market situation is initially a losing strategy for an intraday trader.

Jakub Novak,
Analytical expert of InstaForex
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