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FX.co ★ How to trade GBP/USD on October 3? Simple tips for beginners.

How to trade GBP/USD on October 3? Simple tips for beginners.

Analysis of Friday's deals:

30M chart of the GBP/USD pair

How to trade GBP/USD on October 3? Simple tips for beginners.

The GBP/USD pair tried to continue the upward movement on Friday, but this time it was already unsuccessful. However, the volatility was again very high, and the trend line and the level of 1.1211 could not be overcome. Therefore, now we can only talk about restoring the British currency to the level from which the last round of the fall began. We acknowledge that the British pound's rise this week is very strong and could well be the start of a new long-term upward trend. But at the same time, the pound found resistance in the face of an important trend line and an important level. Therefore, we will also not be surprised if quotes fall again. We would like to note that now the chances of a new upward trend are higher only from a technical point of view. From the fundamental and geopolitical, the pound remains at risk. Thus, we would say that the 1.1211 level is now the key one. The UK published a report on GDP for the second quarter, which showed a slight increase instead of a slight decline, as predicted. The pound has grown a bit after this report was released, although 100 points is only a little in the current circumstances, when the pair passes 200-300 points per day. In any case, it could have been a coincidence as the price reversed several times during the day.

5M chart of the GBP/USD pair

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How to trade GBP/USD on October 3? Simple tips for beginners.

High volatility is clearly visible on the 5-minute timeframe. Only one trading signal was formed. The pair rebounded from the area of 1.1211-1.1236, which was replenished by another level at 1.1200, however, it did not play much significance. The rebound happened and after it the price fell by 150 points at the high. Since the nearest target level was even further away, the position should have been closed manually. We admit that novice traders could not do this at the lowest point, but still it was possible to earn 100 points on this transaction, with which we congratulate everyone. Once again, we pay attention to the fact that when the pair does not stand still, but shows good movements, there is profit, and it is quite large.

How to trade on Monday:

The pound/dollar pair maintains a downward trend on the 30-minute time frame, despite a fairly strong growth during the week. In principle, there is nothing surprising in the correction, given the scale of the recent fall in the pound. However, such a strong move up could be the start of a long-term upward trend. A new week will show us if the last round of growth of the pound was not an accident? On the 5-minute TF tomorrow it is recommended to trade at the levels of 1.0538, 1.0833, 1.0927, 1.1024, 1.1200-1.1211-1.1236, 1.1356. When the price passes after opening a position in the right direction for 20 points, Stop Loss should be set to breakeven. The UK is set to publish the index of business activity in the manufacturing sector for September, and in the US - ISM indexes of business activity in the services and manufacturing sectors. The pound continues to move 200-300 points per day, so the market definitely does not need the help of macroeconomics or "fundamentals".

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 American 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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