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FX.co ★ How to trade GBP/USD on July 29? Simple tips for beginners.

How to trade GBP/USD on July 29? Simple tips for beginners.

Analysis of Thursday's deals:

30M chart of the GBP/USD pair

How to trade GBP/USD on July 29? Simple tips for beginners.

The GBP/USD pair also recovered on Thursday after Wednesday's rise. However, the pound fell much weaker than the euro. In addition, there is an ascending trend line for the pound. Also weak, like the euro, but still rising. And this means that now for the first time in a long time, the euro and the pound are traded at least a little, but still in different ways. The pound retains chances for growth before the Bank of England meeting, which will be held next week, and during which a decision to raise the rate will probably also be made. It remains an open question how the market will react to the tightening of monetary policy by the British central bank, but this is a completely different story. So far, the pound has overcome the important level of 1.2106, so theoretically it can continue to grow. However, look at how sluggishly the quotes are moving up. It feels like they don't want to do it. The US released a disappointing report on GDP for the second quarter. According to it, the economy contracted by 0.9% Q/Q, while forecasts were +0.6% Q/Q. Recall that a quarter earlier, US GDP lost 1.6%. Thus, it is time to talk about the beginning of the recession. However, the dollar did not experience any discomfort in connection with this. Today it confidently grew in tandem with the euro, and simply grew in tandem with the pound.

5M chart of the GBP/USD pair

How to trade GBP/USD on July 29? Simple tips for beginners.

The situation on the 5-minute timeframe is about the same as for the euro/dollar. Last night we added a new level (1.2186) and removed the old one 1.2170. The 1.2186 level is the previous day's high, reached after the announcement of the results of the Federal Reserve meeting. The pair bounced from this level twice during the European trading session, forming sell signals that should have been worked out. Subsequently, the price dropped to the level of 1.2106 and worked it out twice. Therefore, we had very accurate signals at our disposal. We managed to earn about 50 points on a short position. The signal to buy near the level of 1.2106 should also have been worked out, but it was no longer possible to get rich on it, since the pair failed to reach the nearest target level of 1.2186. As a result, the deal was closed by Stop Loss at breakeven, as the price still moved in the right direction for more than 20 points. The last signal to buy in the form of a rebound from the same level of 1.2106 should no longer be worked out, since it was formed too late.

How to trade on Friday:

The pound/dollar pair continues to try to maintain an upward trend on the 30-minute TF. The pound is still growing, but we have a feeling that in the near future it will collapse, like the euro - its attempts to strengthen against the dollar look too unstable and uncertain. On the 5-minute TF on Friday, it is recommended to trade at the levels of 1.1967, 1.2033, 1.2106, 1.2186, 1.2216, 1.2260, 1.2329-1.2337. When the price passes after opening a deal in the right direction for 20 points, Stop Loss should be set to breakeven. No major events or reports scheduled for Friday in the UK. Thus, traders can pay attention only to a few secondary reports in the US, including the change in personal income and expenses of Americans and the consumer confidence index from the University of Michigan.

Basic rules of the trading system:

1) The signal strength is calculated by the time it took to form the signal (bounce or overcome the level). The less time it took, the stronger the signal.

2) If two or more deals were opened near a certain level based on false signals (which did not trigger Take Profit or the nearest target level), then all subsequent signals from this level should be ignored.

3) In a flat, any pair can form a lot of false signals or not form them at all. But in any case, at the first signs of a flat, it is better to stop trading.

4) Trade deals are opened in the time period between the beginning of the European session and until the middle of the US one, when all deals must be closed manually.

5) On the 30-minute TF, using signals from the MACD indicator, you can trade only if there is good volatility and a trend, which is confirmed by a trend line or a trend channel.

6) If two levels are located too close to each other (from 5 to 15 points), then they should be considered as an area of support or resistance.

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.

The MACD indicator (14,22,3) 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 speeches and reports (always contained in the news calendar) can greatly influence the movement of a currency pair. Therefore, during their exit, it is recommended to trade as carefully as possible or exit the market in order to avoid a sharp price reversal against the previous movement.

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.

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