GBP/USD: Simple Trading Tips for Beginner Traders on October 13. Review of Yesterday's Forex Trades

[Ben Graham]

Trade Review and GBP/USD Trading Tips

A test of the 1.3310 level occurred at a moment when the MACD indicator had already moved significantly above the zero line, which limited the pair's upward potential.

The British pound rose sharply, while the U.S. dollar declined following Donald Trump's renewed consideration of implementing 100% tariffs against China. Waves of panic swept through financial markets, forcing investors to hastily reassess their strategies.

Trump's statements, as unexpected as a bolt from the blue, immediately drove the dollar down, exposing its vulnerability in the face of geopolitical uncertainty. The British currency—seemingly unaffected directly by the U.S.–China conflict—capitalized on the situation and demonstrated unexpected resilience.

However, the optimism observed in currency markets may be short-lived. Further escalation of the trade war between the U.S. and China may have unpredictable consequences for the global economy, including the United Kingdom.

No economic reports are expected from the U.K. today, which makes the speech by Megan Greene particularly important. Her remarks on inflation risks, economic growth prospects, and the potential for further interest rate increases could influence both the short-term dynamics of the pound and broader market sentiment.

Investors and analysts will be closely watching for any signs pointing to the Bank of England's intentions regarding monetary policy.

As for the intraday strategy, I will rely primarily on scenarios №1 and №2.

Buy Scenarios

• Scenario 1: I plan to buy the pound today upon reaching the entry point near 1.3362 (thin green line on the chart), targeting a rise to 1.3401 (thicker green line on the chart). Around 1.3401, I plan to close long positions and open shorts in the opposite direction, aiming for a 30–35 pip retracement. This setup plays off continuation from Friday's upward trend.
• Important: Before entering a buy trade, ensure that the MACD indicator is above the zero line and has just begun rising from it.
• Scenario 2: I also plan to buy the pound today in case of two consecutive tests of the 1.3341 level, provided the MACD indicator is in oversold territory. This setup would limit the pair's downside potential and lead to an upward reversal toward 1.3362 and 1.3401.

Sell Scenarios

• Scenario 1: I plan to sell the pound today after a break below the 1.3341 level (thin red line on the chart), which would likely result in strong downward momentum. The key target for sellers will be the 1.3309 level, where I plan to take profit and open new long positions in the opposite direction, aiming for a 20–25 pip retracement. Pound sellers will take advantage of any opportunity to extend losses.
• Important: Before selling, make sure the MACD indicator is below the zero line and has just begun declining from it.
• Scenario 2: I also plan to sell the pound today in case of two consecutive tests of the 1.3362 level, while the MACD is in the overbought zone. This scenario would limit the pair's upward potential and lead to a reversal toward 1.3341 and 1.3309.

What's on the Chart:

• Thin green line – entry price level for buying the trading instrument
• Thick green line – approximate level for placing Take Profit or manually locking in gains, as a further rise above this level is unlikely
• Thin red line – entry price level for selling the trading instrument
• Thick red line – approximate level for placing Take Profit or manually locking in gains, as further decline beyond this point is unlikely
• MACD indicator – when entering the market, be guided by its position in the overbought or oversold zones

Important: Beginner forex traders should be extremely cautious with entry decisions. Before major fundamental reports, it's best to remain out of the market to avoid exposure to abrupt price swings. If you do decide to trade during high-impact events, always place stop-loss orders to minimize losses. Without them, your account balance can deplete quickly, especially if you neglect proper money management and trade large volumes.

And remember, successful trading requires a clear plan—like the one presented above. Spontaneous decision-making based solely on the current market situation is an inherently losing strategy for intraday traders.

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