06.08.202506:57 Forex Analysis & Reviews: How to Trade the GBP/USD Pair on August 6? Simple Tips and Trade Analysis for Beginners

Analysis of Tuesday's Trades

1H Chart of GBP/USD

On Tuesday, the GBP/USD pair also showed no significant movements. As with the EUR/USD pair, only one macroeconomic report had the potential to influence trader sentiment — the ISM Services PMI. This report, unsurprisingly, disappointed, triggering a decline in the dollar during the U.S. session. However, the drop was very mild. One could say the dollar got lucky. Since the price exited the descending channel, the trend on the hourly timeframe has shifted to an upward one. Therefore, in the near term, we expect the British currency to rise. The only potential risk for the pound this week is the Bank of England's meeting, where interest rates could be cut for the third time this year. However, first, we doubt such a decision is a given. Second, the British pound has been performing well in 2025, even amid the Bank of England's monetary easing.

5M Chart of GBP/USD

On the 5-minute timeframe, only one trading signal was generated on Tuesday. During the European session, the price bounced off the 1.3259 level, allowing novice traders to open long positions. During the day, the price climbed by approximately 30–35 pips, and there were plenty of opportunities to close those longs in profit.

Trading Strategy for Wednesday:

On the hourly timeframe, the GBP/USD pair suggests that the downward technical correction is likely over. And after Friday's news, we wouldn't bet even a penny on the dollar's growth. While the market has yet to accelerate dollar selling, this is likely just a temporary lull. Since the price has firmly broken above the descending channel, the trend on the hourly chart has turned upward.

On Wednesday, the GBP/USD pair may continue its upward movement. Therefore, any support level is potentially a point for a bounce and a continuation of the move north. Yesterday, the price bounced off the 1.3259 level, and today it will attempt to break through the 1.3329–1.3331 area.

On the 5-minute timeframe, current levels for trading are: 1.3102–1.3107, 1.3203–1.3211, 1.3259, 1.3329–1.3331, 1.3413–1.3421, 1.3466, 1.3518–1.3532, 1.3574–1.3590, 1.3643–1.3652, 1.3682, 1.3763.

For Wednesday, no important events or reports are scheduled in either the UK or the U.S., so volatility may remain extremely low today.

Core Trading System Rules:

1. Signal Strength: The shorter the time it takes for a signal to form (a rebound or breakout), the stronger the signal.
2. False Signals: If two or more trades near a level result in false signals, subsequent signals from that level should be ignored.
3. Flat Markets: In flat conditions, pairs may generate many false signals or none at all. It's better to stop trading at the first signs of a flat market.
4. Trading Hours: Open trades between the start of the European session and the middle of the US session, then manually close all trades.
5. MACD Signals: On the hourly timeframe, trade MACD signals only during periods of good volatility and a clear trend confirmed by trendlines or trend channels.
6. Close Levels: If two levels are too close (5–20 pips apart), treat them as a support or resistance zone.
7. Stop Loss: Set a Stop Loss to breakeven after the price moves 20 pips in the desired direction.

Key Chart Elements:

Support and Resistance Levels: These are target levels for opening or closing positions and can also serve as points for placing Take Profit orders.

Red Lines: Channels or trendlines indicating the current trend and the preferred direction for trading.

MACD Indicator (14,22,3): A histogram and signal line used as a supplementary source of trading signals.

Important Events and Reports: Found in the economic calendar, these can heavily influence price movements. Exercise caution or exit the market during their release to avoid sharp reversals.

Forex trading beginners should remember that not every trade will be profitable. Developing a clear strategy and practicing proper money management are essential for long-term trading success.