GBP/USD: Simple Trading Tips for Beginner Traders on September 9. Analysis of Yesterday's Forex Trades

[Ben Graham]

Trade Review and Advice on Trading the British Pound

The price test at 1.3520 occurred when the MACD indicator was just starting to move upward from the zero line, which confirmed the correct entry point for buying the pound and resulted in growth toward the target level of 1.3555.

Unfortunately, there is no economic data out of the UK today, so the further direction of the pair will be determined more by technical factors, as well as the bullish momentum that has persisted in the market since the end of last week. Given the absence of fundamental drivers from the UK, technical analysis takes on primary importance. Traders will closely watch the support and resistance levels forming on GBP/USD charts. A breakout of key levels may signal a further move in the price direction. In addition, statements from Bank of England officials will be closely examined for any hints about future monetary policy.

For intraday strategy, I will focus primarily on Scenarios #1 and #2.

Buy Scenario

Scenario #1: Today, I plan to buy the pound if the entry point around 1.3590 (green line on the chart) is reached, targeting a rise to 1.3622 (thicker green line on the chart). Around 1.3622, I plan to exit purchases and open sales in the opposite direction (aiming for a move of 30–35 pips in the opposite direction from that level). The pound's rise can be expected today as a continuation of Friday's trend. Important! Before buying, make sure the MACD indicator is above the zero line and is just starting to move up from it.

Scenario #2: I also plan to buy the pound today if there are two consecutive tests of the price at 1.3567 when the MACD indicator is in the oversold area. This will limit the pair's downside potential and lead to an upward reversal. Growth can be expected toward the opposite levels of 1.3590 and 1.3622.

Sell Scenario

Scenario #1: Today I plan to sell the pound after the level of 1.3567 (red line on the chart) is broken, which will lead to a rapid decline in the pair. The key target for sellers will be the 1.3541 level, where I plan to exit short positions and immediately open buys in the opposite direction (aiming for a move of 20–25 pips in the opposite direction from that level). Pound sellers may become active at any moment today. Important! Before selling, make sure the MACD indicator is below the zero line and is just starting to move down from it.

Scenario #2: I also plan to sell the pound today if there are two consecutive tests of the price at 1.3590 when the MACD indicator is in the overbought area. This will limit the pair's upside potential and lead to a downward reversal. A decline can be expected toward the opposite levels of 1.3567 and 1.3541.

What's on the Chart:

Thin green line – entry price at which the instrument can be bought.

Thick green line – suggested price for taking profit or manually securing profits, as further growth above this level is unlikely.

Thin red line – entry price at which the instrument can be sold.

Thick red line – suggested price for taking profit or manually securing profits, as further decline below this level is unlikely.

MACD indicator: When entering the market, it is important to refer to overbought and oversold areas.

Important. Beginner forex traders should exercise extreme caution when making entry decisions. Before important fundamental reports, it is best to stay out of the market to avoid sharp price swings. If you decide to trade during the release of news, always use 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 large volumes. And remember: for successful trading, you need a clear trading plan, as I described above. Making spontaneous trading decisions based on the current market situation from moment to moment is a losing strategy for an intraday trader.

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