Trading tips for novice traders (analysis of yesterday's trades). Forecast for GBP/USD for August 25

Buy and Sell levels for GBP/USD on August 25. Analysis of yesterday's trading activity in the forex market:

Analysis of trades. Tips on entering and exiting the market

Yesterday, GBP/USD tested 1.3714 at the moment the MACD indicator was far below the zero level, limiting the downward potential of the pair. Later, the price again tested this level after the end of a correction. As a result, a buy signal was generated because MACD located in the oversold zone was moving upward, signaling a change in the trend. The quote went up by 15 pips from the entry point and the uptrend stopped. In the second half of the day, a signal to sell the pair at 1.3714 was generated. Consequently, traders took losses. Yesterday's speech by External Member of the Bank of England's Monetary Policy Committee Silvana Tenreyro caused a decline in the pound sterling. However, the currency very quickly recovered. The release of the US new home sales report prevented GBP/USD from breaking above the daily highs. Today, the UK's macroeconomic calendar is empty. Therefore, the first half of the day should be calm in the market. In the second half of the day, the focus will be on the US durable goods report. The market correction may be right around the corner. Moreover, the US dollar may strengthen. That is why traders should be very careful.

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Buy signal

Traders should consider opening long positions today in case the price reaches the entry point around 1.3736 (the green line on the chart) with the target set at 1.3778 (the thick green line on the chart). In the area of 1.3778, traders should close long positions and consider selling the pair in the opposite direction (allowing a 15-20 pips correction from this level). The pound sterling may well rise in the first half of the day if the price breaks above the weekly highs. Before opening long positions, traders should make sure MACD is above the zero level and starts going up. Long positions should also be considered in case the price reaches 1.3707 and 1.3661 and MACD is in the oversold zone. This will limit the downward potential of the pair and will lead to a reversal of the trend. In such a case, the price may grow to 1.3736 and 1.3778.

Sell signal

Traders should consider entering short positions today if only the price tests the 1.3707 level (the red line on the chart). This will lead to a strong downtrend. Bears' key target is seen at 1.3661 where traders should close short positions and open long ones (allowing a 15-20 pips correction from this level). The pound sterling is likely to face pressure in case there are no signs of activity from bulls. Traders should make sure MACD is below the zero level and starts moving down from it before entering short positions. In addition, short positions should also be considered if the quote reaches 1.3736 and 1.3778 and MACD is in the overbought zone. This will limit the pair's upward potential and will lead to a reversal of the trend. In such a case, the price is expected to go down to 1.3707 and 1.3661.

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What's on the chart:

The thin green line marks the entry price at which you can buy the trading instrument.

The thick green line is the estimated price. You can place a take-profit order or close your positions at this level since the price is unlikely to go above this level.

The thin red line is the entry price at which the trading instrument can be sold.

The thick red line is the estimated price. You can set a take-profit order or close your positions at this level since the price is unlikely to go below it.

MACD. It is important to take into account overbought and oversold zones when entering the market.

Novice traders should be very careful when deciding to enter the market. Ahead of important macroeconomic reports, beginners refrain from entering the market to avoid sharp price fluctuations. If you decide to enter at the time important reports come out, you should always set a stop-loss order to minimize losses. Without a stop-loss order, you risk losing your funds, especially if you do not follow any money management strategy and trade large volumes.

To succeed in trading, you should develop an effective trading strategy. Spontaneous trading in terms of the current market is inherently risky for an intraday trader.

The material has been provided by InstaForex Company - www.instaforex.com

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