Analysis of previous deals:
30M chart of the GBP/USD pair
The GBP/USD pair was trading very actively again on the 30-minute timeframe on Monday. Therefore, novice traders themselves could conduct very active trading for the second trading day in a row, since there were plenty of signals. The upward trend continued for the pound/dollar pair, therefore, buy signals should be considered from the MACD indicator. In principle, only one of these was formed for the entire day, early in the morning and not too far from the zero level. The situation was delicate, since the signal had formed before the opening of the European trading session, that is, in theory, it should have been discarded. However, a little later the price settled above the 1.3838 level, which was also a buy signal. However, this signal also formed before Europe opened. But with the opening of the European session, the pair did not even have time to go far from the levels where two buy signals were formed at once. And so a long position had to be opened. And it could bring from 40 to 140 points of profit. 40 points would be the lowest if novice traders set Take Profit. 60 points - if profit settled near the first target level of 1.3913. If the beginners kept the deal open further, they could make a profit of 100 points or more. By the way, so that there are no doubts about a buy signal: the price also managed to bounce off the 1.3838 level, which is also a buy signal and was formed during the European session. Thus, there was a whole triple buy signal today.
5M chart of the GBP/USD pair
There were many more signals on the 5 minute timeframe, but in general they would also be profitable. Let's start with the fact that the only signal that should have been worked out on the 5-minute timeframe, and even then with a very big stretch, is the very first one - a rebound from the 1.3865 level. It was possible to open short positions with 1.3838 as the target, which was successfully reached, bringing in a profit of about 14 points. There was also a rebound from the 1.3838 level, which we talked about in the section on the 30-minute timeframe, so in any case it was necessary to open long positions and new buy signals were only formed when the pair crossed the next level on its paths. No important macroeconomic report or other event during the day.
How to trade on Tuesday:
On Tuesday, we recommend trading again in accordance with the existing upward trend on the 30-minute timeframe, although the price went much higher than the rising channel. Thus, it will be necessary to wait for new buy signals in the form of upward reversals of the MACD indicator. The MACD indicator needs to be discharged to the zero level, as it is now very high. No important and interesting events scheduled in America. Meanwhile, there are several secondary reports in Britain that are unlikely to provoke a market reaction. The important levels on the 5 minute timeframe are 1.3913, 1.3957, 1.3999 and 1.4081. The price can bounce off them or overcome them. As before, we set Take Profit at a distance of 40-50 points on a 30-minute timeframe, the target on the 5-minute timeframe is the nearest level. If the nearest level is too far away, then you are advised to maintain the deal in manual mode, tracking changes in the market. When passing 20 points in the right direction, we recommend setting Stop Loss to breakeven.
On the chart:
Support and Resistance Levels are the Levels that serve as targets when buying or selling the pair. You can place Take Profit near these levels.
Red lines are the channels or trend lines that display the current trend and show in which direction it is better to trade now.
Up/down arrows show where you should sell or buy after reaching or breaking through particular levels.
The MACD indicator consists of a histogram and a signal line. When they cross, this is a signal to enter the market. It is recommended to use this indicator in combination with trend lines (channels and trend lines).
Important announcements and economic reports that you can always find in the news calendar can seriously influence the trajectory of a currency pair. Therefore, at the time of their release, we recommended trading as carefully as possible or exit the market in order to avoid a sharp price reversal.
Beginners on Forex should remember that not every single trade has to be profitable. The development of a clear strategy and money management are the key to success in trading over a long period of time.