Trade analysis and trading tips for the British pound

The test of the 1.3257 price level occurred when the MACD indicator had already moved significantly below the zero mark, which limited the pair's downward potential. For this reason, I didn't sell the pound. Shortly afterward, another test of 1.3257 coincided with the MACD being in the oversold zone, which enabled the execution of Buy Scenario #2. However, the pair failed to show any significant upward movement.

Yesterday, Jerome Powell stated that the consequences of Trump's policy would likely delay the Fed's ability to reach its goals, which put pressure on the pound and led to renewed dollar buying. He also noted that U.S. interest rates may not be lowered again this year and did not rule out the possibility of hikes. Despite this, some economists argue that Trump's policies, while posing short-term risks, could prove beneficial for the U.S. economy in the long term. However, given the current uncertainty and complexity, the Fed cannot afford to act more dovishly, which plays in favor of the British pound for now. Since no UK statistics are scheduled for today, the lower the correction goes, the higher the chances of large buyers returning to the GBP/USD market.

As for the intraday strategy, I will primarily rely on the implementation of Scenarios #1 and #2.

Buy Scenarios

Scenario #1: I plan to buy the pound today after reaching the entry point around 1.3230 (green line on the chart) with a target at 1.3271 (thicker green line). At 1.3271, I plan to exit the buy trade and open a short position in the opposite direction (expecting a 30–35 point retracement). Pound strength may continue within the current uptrend. 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 today if the 1.3203 level is tested twice in a row while the MACD indicator is in the oversold area. This will limit the pair's downward potential and may lead to a reversal upward. Growth to the opposite levels of 1.3230 and 1.3271 can be expected.

Sell Scenarios

Scenario #1: I plan to sell the pound after breaking below the 1.3203 level (red line on the chart), which should lead to a sharp decline. The key target for sellers will be 1.3171, where I plan to exit short positions and immediately open long trades (expecting a 20–25 point rebound from that level). Be very cautious with selling the pound. Important! Before selling, make sure the MACD indicator is below the zero mark and just starting to fall from it.

Scenario #2: I also plan to sell the pound if the 1.3203 level is tested twice in a row while the MACD is in the overbought zone. This would limit the pair's upward potential and may trigger a reversal downward. A decline toward the opposite levels of 1.3230 and 1.3171 can be expected.

Chart Notes:

• Thin green line – the entry price at which the instrument can be bought
• Thick green line – the suggested Take Profit level, above which further growth is unlikely
• Thin red line – the entry price at which the instrument can be sold
• Thick red line – the suggested Take Profit level, below which further decline is unlikely
• MACD Indicator – always watch the overbought and oversold areas when entering the market

Important: Beginner traders on the Forex market should be extremely cautious when entering positions. It's best to stay out of the market before the release of major fundamental reports to avoid sharp price swings. If you choose to trade during news releases, always use stop-loss orders to minimize losses. Without stop-losses, you could lose your entire deposit very quickly — especially if you neglect money management and trade with large volumes.

And remember: to trade successfully, you must have a clear trading plan, such as the one presented above. Making spontaneous decisions based on current market conditions is an inherently losing strategy for an intraday trader.