Review of Trades and Trading Tips for the British Pound

The 1.3537 price test occurred when the MACD indicator had just started moving downward from the zero line, confirming the validity of the entry point for a short position on the pound. However, the pair never went on to experience a significant decline.

British industry continued to expand in August, but at a noticeably slower pace, with the Manufacturing PMI falling to 51.7 from 51.9. Notably, the slowdown is relatively positive in nature, as it was caused by a reduced focus on maintaining inventories. In other words, companies simply stopped building up stocks in advance due to the risks associated with the war. Nevertheless, the pound barely reacted to the report. Although the data were moderately positive overall, they contained no surprise strong enough to outweigh the impact of the external backdrop.

In the second half of the day, the US agenda will determine the pound's direction, as there are no significant domestic catalysts for the British currency. The focus will be on the ISM Manufacturing PMI, the JOLTS job openings report, and a speech by FOMC member Michael Barr. The ISM index reflects the condition of the manufacturing sector, the job openings report indicates labor-market tightness, and Barr's comments help assess the central bank's stance. Through these channels, the events affect the strength of the US dollar. Strong data would provide additional support for the dollar and could put downward pressure on GBP/USD, while weak data would support the British currency by weakening the US dollar.

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

Buy Signal

Scenario #1: Today, I plan to buy the pound when the entry point is reached around 1.3547 (the green line on the chart), with a target of a rise to 1.3577 (the thicker green line on the chart). Around 1.3577, I will exit the long position and open a short position in the opposite direction, targeting a move of 30–35 points in the opposite direction from the level. A rise in the pound can be expected today only if the US data are weak. Important! Before buying, make sure that the MACD indicator is above the zero line and has only just started rising from it.

Scenario #2: Today, I also plan to buy the pound if the price tests 1.3532 twice consecutively while the MACD indicator is in the oversold zone. This would limit the pair's downward potential and trigger a reversal to the upside. A rise toward the opposite levels of 1.3547 and 1.3577 can be expected.

Sell Signal

Scenario #1: Today, I plan to sell the pound after the 1.3532 level is broken (the red line on the chart), which should lead to a rapid decline in the pair. The key target for sellers will be 1.3509, where I will exit the short position and immediately open a long position in the opposite direction, targeting a move of 20–25 points in the opposite direction from the level. Strong downward pressure on the pound will return if the data are strong. Important! Before selling, make sure that the MACD indicator is below the zero line and has only just started declining from it.

Scenario #2: Today, I also plan to sell the pound if the price tests 1.3547 twice consecutively while the MACD indicator is in the overbought zone. This would limit the pair's upward potential and trigger a reversal to the downside. A decline toward the opposite levels of 1.3532 and 1.3509 can be expected.

What Is Shown on the Chart:

• Thin green line – the entry price at which the trading instrument can be bought;
• Thick green line – the estimated price at which Take Profit orders can be placed or profits can be taken manually, as further growth above this level is unlikely;
• Thin red line – the entry price at which the trading instrument can be sold;
• Thick red line – the estimated price at which Take Profit orders can be placed or profits can be taken manually, as further decline below this level is unlikely;
• MACD indicator. When entering the market, it is important to take the overbought and oversold zones into account.

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

And remember that successful trading requires a clear trading plan, such as the one presented above. Making spontaneous trading decisions based on the current market situation is an inherently losing strategy for an intraday trader.