GBP/USD Trading Strategies: Long and Short Positions Based on Chart Analysis and US Economic Data
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The test of 1.2645, coinciding with the significant rise of the MACD line from zero, limited the further growth of the pair. Another test occurred short after, and this time it prompted a sell signal, but it did not lead to a strong price decrease.
US labor market data lies ahead, particularly the number of initial jobless claims. GDP data for the first quarter follows, and any decrease in the indicators will likely lead to more pressure on dollar, which will offset buying pressure after Fed Chairman Jerome Powell's speech. Meanwhile, the report on the volume of pending home sales will not be of great interest, unlike the statements of FOMC member Raphael Bostic.
For long positions:
Buy when pound hits 1.2665 (green line on the chart) and take profit at the price of 1.2696 (thicker green line on the chart). Growth may continue in the event of poor US statistics. However, when buying, traders should make sure that the MACD line lies above zero or rises from it. Pound can also be bought after two consecutive price tests of 1.2643, but the MACD line should be in the oversold area as only by that will the market reverse to 1.2665 and 1.2696.
For short positions:
Sell when pound reaches 1.2643 (red line on the chart) and take profit at the price of 1.2609. Pressure will increase in the case of strong statistics from the US. However, when selling, traders should make sure that the MACD line lies below zero or drops down from it. Pound can also be sold after two consecutive price tests of 1.2665, but the MACD line should be in the overbought area as only by that will the market reverse to 1.2643 and 1.2609.
What's on the chart: Thin green line - entry price at which you can buy GBP/USD Thick green line - estimated price where you can set Take-Profit (TP) or manually fix profits, as further growth above this level is unlikely. Thin red line - entry price at which you can sell GBP/USD Thick red line - estimated price where you can set Take-Profit (TP) or manually fix profits, as further decline below this level is unlikely.
MACD line- it is important to be guided by overbought and oversold areas when entering the market 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 decision based on the current market situation is an inherently losing strategy for an intraday trader.
