Analysis of Transactions and Trading Tips for the British Pound

The test of the price at 1.3235 occurred when the MACD indicator had moved significantly above the zero mark, limiting the pair's upward potential. For this reason, I did not buy the pound and missed a good upward movement. However, short positions on the bounce from 1.3264 allowed for a decent profit of about 30 pips from the market.

A weak report on the U.S. ISM manufacturing index increased pressure on the U.S. dollar and strengthened the British pound. The published data showed a decline in the ISM manufacturing index, which fell short of analysts' expectations for growth. This decline in U.S. manufacturing activity, reflecting a reduction in new export orders and a slowdown in production rates, raised concerns about the state of the American economy. Many believe that the weak ISM data might prompt the Federal Reserve to reconsider its monetary policy.

As for today, summaries and minutes from the Bank of England's Financial Policy Committee meeting are expected in the first half of the day, along with the financial stability report. Additionally, the housing price index from Nationwide will be released. A careful study of the minutes will enable markets to assess the BoE's hawkish stance. Traders will be looking for hints about possible timelines for maintaining rates at high levels. The financial stability report will provide insight into the current state of the UK's financial system and potential risks that may arise in the near future. Investors and analysts will pay attention to comments about household debt burdens, corporate debt, and the resilience of the banking sector.

The Nationwide housing price index is an important indicator of the state of the British real estate market. An increase in the index may indicate economic strengthening and rising consumer confidence, while a decrease could suggest potential economic problems and a decline in housing demand.

As for the intraday strategy, I will rely more on implementing Scenarios #1 and #2.

Buying Scenarios

Scenario #1: I plan to buy the pound today upon reaching the entry point around 1.3221 (green line on the chart), with a target of rising to 1.3250 (thicker green line on the chart). Around 1.3250, I intend to exit from the long positions and open shorts in the opposite direction (targeting a movement of 30-35 pips in the opposite direction from the level). Expecting strong pound growth is only feasible after good data is released. Important! Before buying, ensure that the MACD indicator is above the zero mark and is just beginning to rise from it.

Scenario #2: I also plan to buy the pound today if there are two consecutive tests of the price at 1.3204 when the MACD indicator is in the oversold area. This will limit the pair's downside potential and lead to an upward market reversal. A rise can be expected towards the opposite levels of 1.3221 and 1.3250.

Selling Scenarios

Scenario #1: I plan to sell the pound today after the level at 1.3204 (red line on the chart) is reached, which will lead to a rapid decline in the pair. The key target for sellers will be the level of 1.3178, where I intend to exit from shorts and immediately open longs in the opposite direction (targeting a movement of 20-25 pips in the opposite direction from the level). Sellers of the pound will emerge in the case of weak data. Important! Before selling, ensure that the MACD indicator is below the zero mark and is just beginning to decline from it.

Scenario #2: I also plan to sell the pound today if there are two consecutive tests of the price 1.3221 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 can be expected towards the opposite levels of 1.3204 and 1.3178.

What's on the Chart:

• Thin green line – entry price at which you can buy the trading instrument;
• Thick green line – estimated price where you can set Take Profit or take profit yourself, as further growth above this level is unlikely;
• Thin red line – entry price at which you can sell the trading instrument;
• Thick red line – estimated price where you can set Take Profit or take profit yourself, as further decline below this level is unlikely;
• MACD Indicator. When entering the market, it is essential to be guided by overbought and oversold zones.

Important: Beginner traders in the Forex market need to make entry decisions with great caution. It is best to stay out of the market before significant fundamental reports to avoid sudden price fluctuations. If you choose 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 large volumes.

And remember, successful trading requires a clear trading plan, like the one presented above. Spontaneous trading decisions based on the current market situation are inherently a losing strategy for the intraday trader.