GBP/USD: Simple Trading Tips for Beginner Traders on November 28. Analysis of Yesterday's Forex Trades

[Ben Graham]

Analysis of Trades and Trading Tips for the British Pound

The price test at 1.3238 occurred as the MACD indicator began to move upward from the zero mark, confirming a good entry point to buy the pound, which resulted in a 17-pip rise.

Today, significant movements in the GBP/USD pair are not expected, as there are no UK reports in the first half of the day. However, despite the absence of macroeconomic news from the UK, one should consider the indirect impact of events in the Eurozone and the USA. Any surprises in German data or US data may provoke fluctuations in the euro, which in turn will affect the British pound through cross rates. Technical analysis indicates the pair is consolidating in a narrow range, especially given the low trading volume due to the U.S. holiday weekend. Overall, until new drivers for movement appear, a relatively stable situation in the GBP/USD market can be expected, with a focus on continuing the upward trend formed after the UK budget publication this Wednesday.

Regarding the intraday strategy, I will rely more on the implementation of Scenarios 1 and 2.

Buy Scenarios

Scenario 1: I plan to buy the pound today upon reaching an entry point around 1.3248 (green line on the chart), with a target at 1.3275 (thicker green line on the chart). At point 1.3275, I plan to exit my long positions and open shorts in the opposite direction (expecting a movement of 30-35 pips in the opposite direction from the level). Strong pound growth is unlikely. Important! Before purchasing, ensure that the MACD indicator is above the zero mark and is just starting to rise from it.

Scenario 2: I also plan to buy the pound today in case the price tests 1.3215 for two consecutive times while the MACD indicator is in the oversold area. This will limit the pair's downside potential and lead to an upward market reversal. One can expect growth to opposing levels of 1.3248 and 1.3275.

Sell Scenarios

Scenario 1: I plan to sell the pound today after updating the level to 1.3215 (red line on the chart), which will trigger a quick decline in the pair. The key target for sellers will be the 1.3192 level, where I plan to exit my shorts and open longs in the opposite direction (expecting a 20-25-pip move in the opposite direction from the level). Pound sellers are unlikely to show significant strength today. Important! Before selling, ensure that the MACD indicator is below the zero mark and is just starting to decline from it.

Scenario 2: I also plan to sell the pound today if the price tests 1.3248 twice in a row, as the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a market reversal downward. One can expect a decrease to opposing levels of 1.3215 and 1.3192.

What the Chart Shows:

• Thin Green Line: Entry price for buying the trading instrument.
• Thick Green Line: Estimated price where Take Profit can be set or where profit can be secured, as further increases above this level are unlikely.
• Thin Red Line: Entry price for selling the trading instrument.
• Thick Red Line: Estimated price where Take Profit can be set or where profit can be secured, as further decreases below this level are unlikely.
• MACD Indicator: When entering the market, it is important to be guided by the overbought and oversold zones.

Important: Beginner traders in the Forex market must be very cautious when making trading entry decisions. It is best to remain out of the market before the release of important fundamental reports to avoid getting caught in sharp price fluctuations. If you decide to trade during news releases, always set stop orders to minimize losses. Without setting stop orders, you can quickly lose your entire deposit, especially if you do not use money management and trade with large volumes.

And remember that successful trading requires having a clear trading plan, similar to the one I presented above. Spontaneous trading decisions based on the current market situation are inherently a losing strategy for intraday traders.

The material has been provided by InstaForex Company - www.instaforex.com