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16.10.202115: 27,10110 Forex Analytical Reviews: How to trade a currency pair GBP / USD October 18? Simple tips for beginners. The pound also continues to be inside the side canal.
Relevance up to 15:00 2021-10-18 UTC + 2
Friday transaction analysis:
30M Schedule Couple GBP / USD.
A pair of GBP / USD on a 30-minute timeframe on Friday, as opposed to Euroovat, continued the upward movement, which began a few days ago. Yesterday even the rising trend line was formed, so in the next few days, you can try to consider signals from the MACD indicator. Recall that in order to form them, it is necessary that the indicator be as close to the zero level as possible. You can also consider a possible rebound from the trend line as an indicator for a purchase. Volatility at a pair of pounds/dollar in recent days is also not bad. Not maximum, of course, but not bad. Thus, it is possible to trade at this time, the main thing is that strong signals are formed. With regard to macroeconomic statistics, then on Friday there were only the same US retail sales report and consumer confidence index from the University of Michigan. The illustration below shows perfectly clearly (marked with ticks) that there was no reaction to these reports. The couple moved up almost all day.
5M chart of GBP/USD pair.
On a 5-minute timeframe, the picture is much more complicated and requires detailed analysis. Trading signals on the pound on Friday were formed a lot. Let’s try to figure out how to trade on the last trading day of the week. The first purchase signal was generated at levels of 1.3688 and 1.3692 for purchase. The price after its formation managed to rise to the level of 1.3734, from which a rebound followed. Therefore, the long position should have been closed manually near 1.3734. The profit on the transaction amounted to about 26 points. On the rebound from the level of 1.3734, a short position should have been opened, but this signal turned out to be false. The price rebounded twice from 1.3734, but eventually overcame this level. Therefore, a loss was received in the amount of 15 points. Then the movements became very complex. Since the level of 1.3749 was 15 points higher than the level of 1.3749, it was not necessary to open purchase transactions. The same goes for the next level of 1.3764, which also had 15 points. All subsequent signals were formed near these levels, so they should not be worked out. As a result, the day was completed in minimal profit.
How to trade on Monday:
At this time, an upward trend has formed on the 30-minute timeframe, and volatility has increased. Thus, in the coming days, you can try to consider signals from the MACD indicator for purchase. On Monday, you can wait until the indicator itself discharges to zero, and the price will adjust slightly down. On a 5-minute timeframe, important levels are 1.3688-1.3692, 1.3734, 1.3749, 1.3733, 1.3796. We recommend trading on them on Monday. From them, the price can rebound or overcome them. As before, Take Profit is displayed at a distance of 40-50 points. On the TF 5M, you can use all the nearest levels, but then you need to record profit, given the strength of the movement. When going in the right direction, 20 points are recommended to put Stop Loss at no loss. On Monday, the only event of the day will be the macroeconomic report on industrial production in the United States. However, he is unlikely to provoke at least some kind of reaction from traders.
Basic rules of the trading system:
1) Signal strength is considered by the time it took to generate the signal (rebound or overcome the level). The Less it took time, the stronger the signal.
2) If two or more transactions for false signals (which did not trigger Take Profit or work out the nearest target level) were opened near any level, then all subsequent signals from this level should be ignored.
3) In the flute, any pair can form a mass of false signals or not form them at all. But in any case, at the first signs of the flat, it is better to stop trading.
4) Trade deals open in time period Between the beginning of the European session and to the middle of the American, when all transactions should be closed manually.
5) On a 30-minute TF on signals from the MACD indicator, it is possible to trade only with the presence of good volatility and trend, which is confirmed by a trend line or trend channel.
6) If two levels are too close to each other (from 5 to 15 points), then they should be considered as a support area or resistance.
What’s on schedule:
Price levels of support and resistance – Levels that are targets for opening purchases or sales. You can place Take Profit levels near them.
Red lines are channels or trend lines that show the current trend and show which direction it is preferable to trade now.
MACD indicator – histogram and signal line, the intersection of which are signals to the market entrance. It is recommended to use in combination with trend constructions (channels, trend lines).
Important speeches and reports (always contained in the news calendar) can very strongly affect the movement of the currency pair. Therefore, during their exit, it is recommended to trade as carefully as possible or leave the market in order to avoid a sharp reversal of the price against the previous movement.
Those starting to trade in the forex market should remember that each transaction cannot be profitable. The development of a clear strategy and mani-management are the key to success in trading for a long period of time.
* Presented market analysis is informative nature and is not a guide to the transaction.
Respectfully, Analyst InsaForex Stanislav Polyansky © 2007-2021