Trade analysis and tips for trading the British pound

The test of the 1.3390 level occurred when the MACD indicator had just started moving upward from the zero mark, confirming a correct entry point for buying the pound. As a result, the pair rose by 30 points.

The release of data showing a 0.4% increase in the UK Consumer Price Index for February generated slight demand for the pound sterling. However, there was no significant strengthening of the currency pair, as the data matched analysts' expectations. The market appears to have already priced in this inflation figure, which limited the positive reaction of the British currency. Moreover, since the data only covered February and more significant developments are expected in the March figures, traders did not react strongly.

In the second half of the day, only U.S. current account balance figures and the import price index are expected. However, market participants are likely to adopt a wait-and-see approach, awaiting new statements from Trump regarding the Middle East and Iran, so the above data is unlikely to change much.

As for the intraday strategy, I will mainly rely on the implementation of scenarios No. 1 and No. 2.

Buy signal

Scenario No. 1: I plan to buy the pound today when the price reaches the entry point around 1.3415 (green line on the chart), with a target of 1.3461 (thicker green line on the chart). Around 1.3461, I plan to exit long positions and open short positions in the opposite direction (targeting a 30–35 point move). Pound growth today can be expected after weak U.S. data.Important: Before buying, make sure the MACD indicator is above the zero mark and just beginning to rise from it.

Scenario No. 2: I also plan to buy the pound if there are two consecutive tests of the 1.3387 level while the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to a reversal upward. Growth toward the opposite levels of 1.3415 and 1.3461 can be expected.

Sell signal

Scenario No. 1: I plan to sell the pound after a break below the 1.3387 level (red line on the chart), which may lead to a quick decline in the pair. The key target for sellers will be 1.3328, where I plan to exit short positions and immediately open long positions in the opposite direction (targeting a 20–25 point move). Pressure on the pound may return at any moment.Important: Before selling, make sure the MACD indicator is below the zero mark and just beginning to decline from it.

Scenario No. 2: I also plan to sell the pound if there are two consecutive tests of the 1.3415 level while the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a reversal downward. A decline toward the opposite levels of 1.3387 and 1.3328 can be expected.

Chart notes

• Thin green line – entry price for buying the instrument;
• Thick green line – estimated level for placing Take Profit or locking in profits, as further growth above this level is unlikely;
• Thin red line – entry price for selling the instrument;
• Thick red line – estimated level for placing Take Profit or locking in profits, as further decline below this level is unlikely;
• MACD indicator: when entering the market, it is important to consider overbought and oversold zones.

Important: Beginner Forex traders should be very cautious when making entry decisions. Before major fundamental reports are released, it is best to stay out of the market to avoid sharp price fluctuations. If you choose to trade during news releases, always use stop-loss orders to minimize losses. Without stop-loss orders, you can quickly lose your entire deposit, especially if you do not use proper money management and trade large volumes.

Remember that successful trading requires a clear trading plan, like the one outlined above. Making spontaneous trading decisions based on current market conditions is generally a losing strategy for an intraday trader.