Analysis and trading recommendations for GBP/USD on September 2

Analysis of transactions in the GBP / USD pair

There was a signal to buy in GBP / USD on Wednesday, but it had to be ignored because it appeared when the MACD line was at the overbought area. Accordingly, the pair declined by 18 pips amid pressure from bearish traders.

The UK data released yesterday did not affect the market in any way since it was only slightly at odds with the forecasts. On the other hand, the employment report from US hurt dollar, which led to a rise in GBP / USD.

Today, there will be a report on US jobless claims and foreign trade balance, which could provoke a deeper plunge in the pair if the figures exceed expectations. But if the numbers are weak, pound may soar once again.

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For long positions:

Take a long position when pound reaches 1.3782 (green line on the chart), and then take profit at the level of 1.3829 (thicker green line on the chart). The pair may continue the bullish trend observed yesterday. But before buying, make sure that the MACD line is above zero, or is starting to rise from it.

It is also possible to buy at 1.3761 and 1.3704, but the MACD line should be in the oversold area, as only by that will the market reverse to 1.3782 and 1.3829.

For short positions:

Take a short position when pound reaches 1.3761 (red line on the chart), and then take profit at the level of 1.3704. A decline will occur if US releases very weak data on employment, as such will force the Federal Reserve System to adhere to a wait-and-see attitude on monetary policy. But before selling, make sure that the MACD line is below zero, or is starting to move down from it.

The pair could also be sold at 1.3782 and 1.3829, but the MACD line should be in the overbought area, as only by that will the market reverse to 1.3761 and 1.3704.

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What's on the chart:

The thin green line is the key level at which you can place long positions in the GBP/USD pair.

The thick green line is the target price, since the quote is unlikely to move above this level.

The thin red line is the level at which you can place short positions in the GBP/USD pair.

The thick red line is the target price, since the quote is unlikely to move below this level.

MACD line - when entering the market, it is important to be guided by the overbought and oversold zones.

Important: Novice traders need to be very careful when making decisions about entering the market. Before the release of important reports, it is best to stay out of the market to avoid being caught in sharp fluctuations in the rate. If you decide to trade during the release of news, then always place stop orders to minimize losses. Without placing stop orders, you can very quickly lose your entire deposit, especially if you do not use money management and trade large volumes.

And remember that for successful trading, you need to have a clear trading plan. Spontaneous trading decisions based on the current market situation is an inherently losing strategy for an intraday trader.

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

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