GBP/USD: Tips for Beginner Traders for October 30th (U.S. Session)

[Ben Graham]

Analysis of trades and trading advice for the British pound

The price test of 1.3205 occurred when the MACD indicator had just begun to move downward from the zero mark. This confirmed a correct entry point for selling the pound and resulted in the pair dropping toward the target level of 1.3183.

The lack of statistics from the UK affected GBP/USD volatility, although sellers still prevailed. During the U.S. session, FOMC member Michelle Bowman and FOMC member Lorie K. Logan are expected to speak. We'll see what comments they make following yesterday's Fed decision.

The Federal Reserve's decision to cut interest rates has undoubtedly become a catalyst for numerous questions and debates within financial circles. Therefore, I am closely awaiting the speeches from Bowman and Logan. Their remarks may provide deeper insight into the rationale behind this move and, more importantly, the future outlook for monetary policy.

The comments of these prominent FOMC figures could shed light on what factors the Fed currently sees as the greatest risks to the U.S. economy. Will they view the rate cut as a preventive measure to stimulate labor market growth, or as a response to lower inflation? The answers will help traders and investors adjust their strategies and expectations.

As for the intraday strategy, I'll rely mainly on Scenarios No. 1 and No. 2.

Buy Signal

Scenario No. 1: I plan to buy the pound today upon reaching the entry point around 1.3202 (green line on the chart), targeting a rise to 1.3237 (thicker green line). Around 1.3237, I'll exit buy positions and open sell trades in the opposite direction, expecting a 30–35 point pullback from that level. A rise in the pound is likely if the Fed maintains a very dovish stance.Important: Before buying, make sure the MACD indicator is above the zero line and just starting to rise from it.

Scenario No. 2: I also plan to buy the pound if there are two consecutive tests of the 1.3179 price, at a time when the MACD indicator is in the oversold area. This should limit the pair's downward potential and lead to an upward reversal. Growth toward the 1.3202 and 1.3237 levels can be expected.

Sell Signal

Scenario No. 1: I plan to sell the pound today after a breakout below 1.3179 (red line on the chart), which should trigger a rapid decline in the pair. The main target for sellers will be 1.3147, where I will exit short positions and open buys in the opposite direction, expecting a 20–25 point rebound from that level. The pound may fall only if the Fed takes a hawkish stance.Important: Before selling, make sure the MACD indicator is below the zero line and just starting to fall from it.

Scenario No. 2: I also plan to sell the pound today if there are two consecutive tests of the 1.3202 price, while the MACD indicator is in the overbought area. This should limit the pair's upward potential and trigger a downward reversal. A decline toward 1.3179 and 1.3147 can be expected.

Chart Key

• Thin green line – entry price level where the instrument can be bought.
• Thick green line – suggested level to set Take Profit or manually lock in profit, as further growth above this level is unlikely.
• Thin red line – entry price level where the instrument can be sold.
• Thick red line – suggested level to set Take Profit or manually lock in profit, as further decline below this level is unlikely.
• MACD indicator – when entering the market, it's important to follow overbought and oversold zones.

Important Note for Beginners

New Forex traders should be very cautious when making entry decisions. Before major fundamental reports are released, it's best to stay out of the market to avoid sharp price swings. If you decide to trade during news events, always place stop-loss orders to minimize losses. Without stop-losses, you can quickly lose your entire deposit, especially if you don't use money management and trade with large volumes.

And remember: For successful trading, you must have a clear trading plan, like the one outlined above. Making spontaneous trading decisions based on the current market situation is a losing strategy for any intraday trader.

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