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FX.co ★ Analysis and trading tips for GBP/USD on June 23

Analysis and trading tips for GBP/USD on June 23

Analysis of transactions in the GBP / USD pair

GBP/USD reaching 1.2213 prompted a sell signal in the market, however, having the MACD line far from zero limited the downside potential of the pair. Similarly, there was no sharp movement after the pound reached 1.2247 because the MACD line was still away from zero. It was only during the US trading session that the pair showed an increase as the buy signal at 1.2247 coincided with the MACD line moving above zero. It pushed the pair 60 pips up to 1.2311.

Analysis and trading tips for GBP/USD on June 23

Pound collapsed after UK reported record-breaking inflation in May. The Office for National Statistics said CPI accelerated to 9.1%, from 9% in April. Retail prices also rose more than expected, soaring to 11.7%. Commodity prices jumped 22.1%, while holiday goods rose 15.7% year-over-year.

But there is a chance that GBP will recover today as ahead are reports on business activity in the UK. Strong figures will return demand for the currency, while similar reports from the US in the afternoon are likely to put pressure on the dollar. The speech of Fed chairman Jerome Powell also have little to no effect on the market.

For long positions:

Buy pound when the quote reaches 1.2268 (green line on the chart) and take profit at the price of 1.2335 (thicker green line on the chart). There is a chance for a rally today, but only if upcoming UK statistics exceed expectations. Nevertheless, remember that when buying, the MACD line should be above zero, or is starting to rise from it. It is also possible to buy at 1.2219, but the MACD line should be in the oversold area as only by that will the market reverse to 1.2268 and 1.2335.

For short positions:

Sell pound when the quote reaches 1.2219 (red line on the chart) and take profit at the price of 1.2160. Pressure will return if the UK reports weak economic statistics and if the Fed says new hawkish rhetoric. However, when selling, make sure that the MACD line is below zero or is starting to move down from it. Pound can also be sold at 1.2268, but the MACD line should be in the overbought area, as only by that will the market reverse to 1.2219 and 1.2160.

See also: Start Forex trading with a European level broker!
Analysis and trading tips for GBP/USD on June 23

What's on the chart:

The thin green line is the key level at which you can place long positions in the GBP/USD pair.

The thick green line is the target price, since the quote is unlikely to move above this level.

The thin red line is the level at which you can place short positions in the GBP/USD pair.

The thick red line is the target price, since the quote is unlikely to move below this level.

MACD line - when entering the market, it is important to be guided by the overbought and oversold zones.

Important: Novice traders need to be very careful when making decisions about entering the market. Before the release of important reports, it is best to stay out of the market to avoid being caught in sharp fluctuations in the rate. If you decide to trade during the release of news, then always place stop orders to minimize losses. Without placing stop orders, you can very quickly lose your entire deposit, especially if you do not use money management and trade large volumes.

And remember that for successful trading, you need to have a clear trading plan. Spontaneous trading decision based on the current market situation is an inherently losing strategy for an intraday trader.

*The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade
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