Analysis of Trades and Trading Tips for the British Pound

In the second half of the day, the test of the 1.2260 price level coincided with the MACD indicator beginning to rise from the zero mark. This confirmed a valid entry point for buying the pound. As a result, the pair increased by over 70 pips.

Demand for the pound increased, even though the UK labor market data released yesterday was slightly disappointing, with the unemployment rate higher than economists had predicted. The market remains sensitive to news events and tends to react to any statements made by Trump and his new administration.

Today, we can expect data on the UK public sector net borrowing, which is a key indicator of financial stability and economic policy. An increase in net debt may signal rising financial risks, potentially affecting investor decisions and international credit ratings. In times of economic volatility, public debt levels become particularly important. Additionally, the Bank of England's Quarterly Bulletin will provide insights into economic policy and financial trends. This includes forecasts for inflation, employment, and GDP growth, as well as an analysis of credit policy. Such data can lead to revisions of important economic forecasts, which, in turn, influence financial markets.The combination of borrowing data and insights from the bulletin creates a comprehensive view of the country's current economic situation, impacting projections made by both experts and investors.

For my intraday strategy, I will mainly focus on implementing Scenarios #1 and #2.

Buy Signal

Scenario #1: Today, I plan to buy the pound at the entry point around 1.2348 (green line on the chart) with a target of 1.2415 (thicker green line on the chart). Around 1.2415, I plan to exit the purchases and open sales in the opposite direction (targeting a movement of 30-35 pips in the opposite direction from the level). Expecting the pound to rise after strong data. Important! Before buying, ensure the MACD indicator is above the zero mark and beginning to rise.

Scenario #2: I also plan to buy the pound today in case of two consecutive tests of the 1.2312 price level when the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to an upward market reversal. Growth to the opposite levels of 1.2348 and 1.2415 can be expected.

Sell Signal

Scenario #1: I plan to sell the pound after the price breaks below 1.2312 (red line on the chart), which could lead to a rapid decline in the pair. The key target for sellers will be the 1.2243 level, where I plan to exit the sales and immediately open purchases in the opposite direction (targeting a movement of 20-25 pips in the reverse direction from the level). Selling the pound is preferable at higher levels, anticipating a return to the bearish trend. Important! Before selling, ensure the MACD indicator is below the zero mark and beginning to decline.

Scenario #2: I also plan to sell the pound today in case of two consecutive tests of the 1.2348 price level when the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a market reversal downward. A decline to the opposite levels of 1.2312 and 1.2243 can be expected.

Chart Notes

• Thin green line: Entry price for buying the trading instrument.
• Thick green line: A suggested target for Take Profit or manually locking in profits, as further growth above this level is unlikely.
• Thin red line: Entry price for selling the trading instrument.
• Thick red line: A suggested target for Take Profit or manually locking in profits, as further decline below this level is unlikely.
• MACD Indicator: Critical for identifying overbought and oversold zones to guide market entry decisions.

Important Note for Beginner Traders

• Always approach market entry decisions cautiously.
• Avoid trading during major news releases to sidestep volatile price swings.
• If trading during news releases, always set stop-loss orders to minimize losses.
• Trading without stop-loss orders or money management practices can quickly deplete your deposit, especially when using large volumes.
• A clear trading plan, like the one outlined above, is essential for successful trading. Spontaneous trading decisions based on current market conditions are inherently disadvantageous for intraday traders.