01.07.202618:12 Forex Analyse & Reviews: GBP/USD: Trading Tips for Beginner Traders – July 1st (U.S. Session)

Trade Review and Tips for Trading the British Pound

The test of the 1.3230 level occurred when the MACD indicator had just begun moving below the zero line, confirming a valid entry point for a short position on the pound. However, the pair failed to move lower.

The British pound showed remarkable resilience despite the release of mixed economic data from the United Kingdom. Although the manufacturing sector ended the second quarter on what appeared to be a positive note, the data failed to generate any significant enthusiasm among traders. The Manufacturing PMI for June came in at 52.5, down from the previous month's reading.

Traders are now awaiting another round of U.S. economic data, which could significantly alter expectations regarding the Federal Reserve's next monetary policy decisions. The labor market will remain the primary focus, as it continues to serve as one of the most important indicators of the health of the U.S. economy. Particular attention will be paid to the June ADP Employment Change report. Published by Automatic Data Processing, this indicator is often viewed as a leading indicator of the official Nonfarm Payrolls (NFP) report.

The ISM Manufacturing PMI will also be closely watched. It reflects conditions in the U.S. manufacturing sector and is considered one of the leading economic indicators. An increase in the index would point to stronger manufacturing activity, which would be viewed as a positive signal for the U.S. economy and, consequently, supportive of the U.S. dollar.

The highlight of the trading day will be the speech by FOMC Chairman Kevin Warsh. Market participants will closely analyze his remarks for clues about the Federal Reserve's future policy direction.

As for my intraday strategy, I will primarily rely on the implementation of Scenario No. 1 and Scenario No. 2.

Buy Signal

Scenario No. 1: I plan to buy the pound if the price reaches the entry level around 1.3261 (the green line on the chart), with a target at 1.3307 (the thicker green line on the chart). Around 1.3307, I plan to close long positions and immediately consider opening short positions, expecting a 30–35 point move in the opposite direction. A strong rally in the pound is likely only if the U.S. data come in weaker than expected. Important: Before buying, make sure the MACD indicator is above the zero line and has just begun moving higher.

Scenario No. 2: I also plan to buy the pound if the price tests 1.3241 twice consecutively while the MACD indicator is in oversold territory. This would limit the pair's downward potential and trigger a bullish market reversal. In this case, the pair may rise toward 1.3261 and 1.3307.

Sell Signal

Scenario No. 1: I plan to sell the pound after the price breaks below 1.3241 (the red line on the chart), which should trigger a rapid decline in the pair. The primary downward target is 1.3201, where I plan to close short positions and immediately consider opening long positions, expecting a 20–25 point rebound. Selling pressure on the pound is likely to return if the U.S. economic data are strong. Important: Before selling, make sure the MACD indicator is below the zero line and has just begun moving lower.

Scenario No. 2: I also plan to sell the pound if the price tests 1.3261 twice consecutively while the MACD indicator is in overbought territory. This would limit the pair's upward potential and trigger a bearish market reversal. In this case, the pair may decline toward 1.3241 and 1.3201.

Chart Guide

• Thin green line – the suggested entry price for long positions.
• Thick green line – the suggested Take Profit level or an area to lock in profits manually, as further gains above this level are considered unlikely.
• Thin red line – the suggested entry price for short positions.
• Thick red line – the suggested Take Profit level or an area to lock in profits manually, as further declines below this level are considered unlikely.
• MACD indicator – when entering the market, pay close attention to overbought and oversold conditions.

Important: Beginner Forex traders should exercise caution when entering the market. It is generally advisable to stay out of the market ahead of major fundamental data releases to avoid sharp price fluctuations. If you choose to trade during news releases, always use stop-loss orders to minimize potential losses. Trading without stop-loss orders can quickly result in the loss of your entire trading account, particularly if you trade large position sizes without applying proper risk management.

Finally, remember that successful trading requires a clear trading plan, such as the one outlined above. Making spontaneous trading decisions based solely on current market conditions is generally a losing strategy for intraday traders.