Analysis of transactions in the GBP / USD pair

GBP/USD reaching 1.2391 led to a buy signal in the market, but having the MACD line far from zero limited the upside potential of the pair. Selling at 1.2455 after another sharp jump in the pair also did not bring success.

GBP/USD rose yesterday because data on UK jobless claims, unemployment rate and average earnings exceeded expectations. At the same time, a disappointing report on US retail sales decreased demand for the dollar, leading to a further rise in the pound.

Pressure may return in the pair today if the UK reports weak data on consumer prices. And if the bulls fail to defend the next support levels, pound will most likely return to yesterday;s opening price level. In the afternoon, the US will release reports on issued building permits and new foundations, but they are unlikely to affect the market. As for the scheduled speeches of FOMC members, a softer position or dovish statements put pressure on dollar and lead to another rise in pound.

For long positions:

Buy pound when the quote reaches 1.2482 (green line on the chart) and take profit at the price of 1.2540 (thicker green line on the chart). There is a chance for a rally today after the release of inflation data. But note that when buying, make sure that the MACD line is above zero, or is starting to rise from it. It is also possible to buy at 1.2440, but the MACD line should be in the oversold area as only by that will the market reverse to 1.2482 and 1.2540.

For short positions:

Sell pound when the quote reaches 1.2440 (red line on the chart) and take profit at the price of 1.2353. Pressure will return if there are no buyers at 1.2440 and if the US reports good macroeconomic statistics. But note that when selling, make sure that the MACD line is below zero, or is starting to move down from it. Pound can also be sold at 1.2482, however, the MACD line should be in the overbought area, as only by that will the market reverse to 1.2440 and 1.2353.

What's on the chart:

The thin green line is the key level at which you can place long positions in the GBP/USD pair.

The thick green line is the target price, since the quote is unlikely to move above this level.

The thin red line is the level at which you can place short positions in the GBP/USD pair.

The thick red line is the target price, since the quote is unlikely to move below this level.

MACD line - when entering the market, it is important to be guided by the overbought and oversold zones.

Important: Novice traders need to be very careful when making decisions about entering the market. Before the release of important reports, it is best to stay out of the market to avoid being caught in sharp fluctuations in the rate. If you decide to trade during the release of news, then always place stop orders to minimize losses. Without placing stop orders, you can very quickly lose your entire deposit, especially if you do not use money management and trade large volumes.

And remember that for successful trading, you need to have a clear trading plan. Spontaneous trading decisions based on the current market situation is an inherently losing strategy for an intraday trader.