The legend in the InstaSpot team!
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The price test at 1.3256 occurred when the MACD indicator had risen significantly above the zero mark, limiting the pair's upward potential. The second test at 1.3256 coincided with the MACD being in the overbought area, allowing the execution of scenario #2: selling the pound, resulting in a decline of more than 30 pips.
The British pound experienced significant pressure following the release of fresh data on the US manufacturing sector's business activity index. The indicator, reflecting the state of the American economy, demonstrated impressive resilience, remaining above the important level of 54.0 points.
Today, the first half of the day looks similar, but for the UK. Market players are awaiting the March data on the services sector's business activity index. This is one of the key indicators of the British economy's health, reflecting activity in one of its critical sectors. The publication of the composite PMI index will also be significant. This indicator, which combines data from both manufacturing and services, will provide a more comprehensive understanding of the country's economic situation. Low results for either of these indexes, especially both, could trigger a more rapid decline in the British pound. Conversely, if the published figures exceed expectations, the pound may strengthen.
Regarding the intraday strategy, I will primarily rely on scenarios #1 and #2.
Scenario #1: I plan to buy the pound today upon reaching an entry point around 1.3237 (green line on the chart) with a target for growth to 1.3261 (thicker green line on the chart). Around 1.3261, I intend to exit the long positions and open short positions in the opposite direction, anticipating a movement of 30-35 pips back from the level. Expecting a rise in the pound today is only reasonable after very strong data. Important! Before buying, ensure that the MACD indicator is above the zero mark and just starting to rise from it.
Scenario #2: I also plan to buy the pound today if the price tests 1.3217 twice in a row while the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to a market reversal upwards. A rise to the resistance levels of 1.3237 and 1.3261 can be expected.
Scenario #1: I plan to sell the pound today after breaking the level of 1.3217 (red line on the chart), which will lead to a rapid decline in the pair. The key target for sellers will be the 1.3186 level, where I intend to exit the shorts and immediately open longs in the opposite direction (anticipating a move of 20-25 pips back from the level). Pressure on the pound could return at any moment. Important! Before selling, ensure that the MACD indicator is below the zero mark and just starting to decline from it.
Scenario #2: I also plan to sell the pound today if the price tests 1.3237 twice in a row, when the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a market reversal downwards. A decline to the support levels at 1.3217 and 1.3186 is expected.
Important: Beginner traders in the Forex market need to be very cautious when making entry decisions. It is best to be out of the market before important fundamental reports are released to avoid being caught in sharp price fluctuations. If you choose to trade during news releases, always set stop orders to minimize losses. Without setting stop orders, you can quickly lose your entire deposit, especially if you do not use money management and trade large volumes.
And remember, for successful trading, it is essential to have a clear trading plan, like the one presented above. Spontaneous trading decisions based on the current market situation are inherently a losing strategy for intraday traders.
*Analiza tržišta koja se ovde nalazi namenjena je boljem razumevanju tržišta i ne pruža instrukcije za vršenje trgovanja.
Uz InstaSpot-ove analitičke preglede uvek ćete biti u toku sa tržišnim trendovima! Klijentima InstaSpot-a su dostupni mnogobrojni besplatni servisi za uspešno trgovanje.
