Buy and Sell levels in GBP/USD for September 3. Analysis of yesterday's trades in Forex
Analysis of trades. Tips for entering and exiting the market
Yesterday, there were only two buy signals. One of them turned out to be a profitable one.
The price tested 1.3782 for the first time when the MACD was well above zero. Therefore, it was decided not to buy the pound sterling but to wait for a while. The upward trend was not strong enough and the pair fell below 1.3782. The price tested this level for the second time at the moment the MACD started moving upward from the zero line. All this confirmed the right choice of the pivot point. As a result, a buy signal was generated. The quote went up by around 50 pips. Mixed data on initial jobless claims in the US boosted the sterling. A sharp increase in the price allowed the pound to leave the sideways channel it has been trading in since the middle of this week. The UK's services, manufacturing, and composite PMIs are among the important macroeconomic reports scheduled for today. If the data beats economists' forecasts, the pound is likely to rise in the short term. However, in the second half of the day, when the US labor market report is released, the situation may drastically change. The market will solely be focused on the unemployment rate and nonfarm payrolls in the US. Disappointing results are expected to send a clear buy signal. In such a case, a new upward trend in GBP/USD will begin.
Buy signal
Today, traders should consider buying the pound when the price reaches the pivot point around 1.3848 (the green line on the chart) with the target set at 1.3895 (a thicker green line on the chart). Long positions should be closed at around 1.3895. This is where short positions should be considered, allowing a 15-20 pips correction from this level. The pound is expected to increase in the first half of the day and after strong data on the UK's business activity in the services sector comes out. Importantly, before entering long positions, make sure the MACD is located above the zero line. Long positions should also be considered today in case the price reaches 1.3820 and the MACD is located in the oversold zone at this moment. This will limit the pair's downside potential and lead to a reversal. Then, the quote may go to 1.3848 and 1.3895.
Sell signal
Today, traders should sell the pound sterling after the 1.3820 level is tested (the red line on the chart). This may lead to a downward trend in the market. The target is seen at 1.3772. Short positions should be closed and long ones opened at this level, allowing a 15-20 pips correction. Pressure on the pound is likely to increase in case disappointing PMI data in the UK and strong labor market statistics in the US come out. If so, the Federal Reserve may consider the possibility of monetary policy tightening, which is a clear signal for the greenback to strengthen. Importantly, before selling, make sure the MACD is located below the zero line. Short positions should also be considered today in case the price reaches 1.3848 and the MACD is located in the overbought zone at this moment. This will limit the pair's upside potential and lead to a reversal. Then, the quote may go to 1.3820 and 1.3772.
What's on the chart:
The thin green line marks the entry price at which you can buy the trading instrument.
The thick green line is the estimated price where you can place a take-profit order or close your positions since the price is unlikely to go above this level.
The thin red line is the entry price at which the trading instrument can be sold.
The thick red line is the estimated price where you can set a take-profit order or close your positions since the price is unlikely to go below this level.
MACD. It is important to take into account overbought and oversold zones when entering the market.
Novice traders should be very careful when deciding to enter the market. Ahead of important macroeconomic reports, beginners should not enter the market to avoid sharp price fluctuations. If you decide to enter at the time important reports come out, you should always set a stop-loss order to minimize losses. Without a stop-loss order, you risk losing your funds, especially if you do not follow any money management strategy and trade large volumes.
To succeed in trading, you should develop an effective trading strategy. Spontaneous trading in terms of the current market situation is inherently risky for an intraday trader.
