Trade Review and Trading Advice for the British Pound

Due to low market volatility, the price did not reach the levels I had outlined.

Amid the current calm on the macroeconomic front, the British pound still retains favorable prospects. In the absence of new statistical data, the market tends to continue previous trends. Let me remind you that on Friday the pound showed noticeable strength following news of slowing inflation in the United States, which may support further gains during today's North American session.

In the second half of the day, FOMC member Michelle Bowman is scheduled to speak, so we await her comments on the recent data related to easing inflation in the U.S. Traders always closely monitor any hints regarding the future policy of the Federal Reserve, and Bowman's remarks could significantly influence investor sentiment. She is expected to address topics such as the current state of the economy and inflation prospects. As mentioned earlier, the latest economic reports, including consumer price index data, showed a slowdown in inflation growth. This trend creates grounds for a more active approach by the Fed toward further interest rate cuts. However, despite signs of easing, inflation remains above the 2% target level, which will likely keep the regulator cautious.

As for my intraday strategy, I will primarily rely on implementing Scenarios No. 1 and No. 2.

Buy Signal

Scenario No. 1: Today, I plan to buy the pound at the entry point around 1.3659 (green line on the chart), targeting growth toward 1.3691 (thicker green line on the chart). Around 1.3691, I will exit long positions and open short positions in the opposite direction (expecting a 30–35 point move from the level). Pound growth today can be expected following a dovish stance from Bowman.Important! Before buying, make sure the MACD indicator is above the zero line and just beginning to rise from it.

Scenario No. 2: I also plan to buy the pound if there are two consecutive tests of the 1.3638 level while the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to an upward market reversal. Growth toward the opposite levels of 1.3659 and 1.3691 can then be expected.

Sell Signal

Scenario No. 1: Today, I plan to sell the pound after the level of 1.3638 is updated (red line on the chart), which could trigger a rapid decline in the pair. The key target for sellers will be 1.3604, where I will exit short positions and immediately open long positions in the opposite direction (expecting a 20–25 point move from the level). Pressure on the pound will return if Bowman takes a hawkish stance.Important! Before selling, make sure the MACD indicator is below the zero line and just beginning to decline from it.

Scenario No. 2: I also plan to sell the pound if there are two consecutive tests of the 1.3659 level while the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a downward market reversal. A decline toward the opposite levels of 1.3638 and 1.3604 can then be expected.

Chart Explanation

• Thin green line – entry price for buying the instrument.
• Thick green line – estimated level for placing Take Profit or locking in profits manually, as further growth above this level is unlikely.
• Thin red line – entry price for selling the instrument.
• Thick red line – estimated level for placing Take Profit or locking in profits manually, as further decline below this level is unlikely.
• MACD indicator – when entering the market, it is important to consider overbought and oversold zones.

Important

Beginner Forex traders should be very cautious when making market entry decisions. Before the release of major fundamental reports, it is best to stay out of the market to avoid sharp price fluctuations. If you choose to trade during news releases, always place stop-loss orders to minimize losses. Without stop-loss orders, you can quickly lose your entire deposit, especially if you do not apply proper money management and trade large volumes.

Remember, successful trading requires a clear trading plan, like the one outlined above. Making spontaneous trading decisions based solely on the current market situation is an inherently losing strategy for an intraday trader.