Trade review and tips for trading the British pound

The price test of 1.3567 occurred when the MACD indicator had just begun to move down from the zero mark, confirming the correct entry point for selling the pound. As a result, the pair moved down only about 10 points before demand returned.

During the U.S. session, the NFIB Small Business Optimism Index report is expected. After strong data, the pound may decline slightly against the dollar. While this indicator is not decisive, it can bring short-term volatility to quotes, especially if its value deviates significantly from expectations. Investors closely monitor sentiment in the small business sector, as it is an important indicator of the overall state of the U.S. economy.

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

Buy Signal

Scenario #1: I plan to buy the pound today on a move toward 1.3594 (green line on the chart) with a target of 1.3640 (thicker green line on the chart). Around 1.3640, I will exit purchases and open sales in the opposite direction, targeting a 30–35 point move back from the level. Strong growth in the pound today is possible as the trend continues to develop. Important! Before buying, make sure the MACD indicator is above the zero mark and just beginning to rise from it.

Scenario #2: I also plan to buy the pound if the price tests 1.3573 twice in a row while the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to a reversal upward. Growth can be expected toward the opposite levels of 1.3594 and 1.3640.

Sell Signal

Scenario #1: I plan to sell the pound after a breakout of 1.3573 (red line on the chart), which will lead to a quick decline in the pair. The key target for sellers will be 1.3533, where I will exit sales and immediately open purchases in the opposite direction, targeting a 20–25 point move back from the level. Most likely, the pound will not show a strong decline. Important! Before selling, make sure the MACD indicator is below the zero mark and just beginning to move down from it.

Scenario #2: I also plan to sell the pound if the price tests 1.3594 twice in a row while the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a reversal downward. A decline can be expected toward the opposite levels of 1.3573 and 1.3533.

What's on the chart:

• Thin green line – entry price for buying the instrument;
• Thick green line – projected price for placing Take Profit or manually fixing profit, as further growth above this level is unlikely;
• Thin red line – entry price for selling the instrument;
• Thick red line – projected price for placing Take Profit or manually fixing profit, as further decline below this level is unlikely;
• MACD indicator – when entering the market, it is important to be guided by overbought and oversold zones.

Important: Beginner Forex traders must be very cautious when deciding to enter the market. Before the release of major fundamental reports, it is best to stay out of the market to avoid sharp fluctuations. If you decide to trade during news releases, always place stop orders to minimize losses. Without stop orders, you can quickly lose your entire deposit, especially if you do not use money management and trade large volumes.

And remember: for successful trading, you must have a clear trading plan, like the one I presented above. Spontaneous decision-making based on the current market situation is an inherently losing strategy for intraday traders.