Trade Review and Trading Recommendations for the British Pound

The test of the 1.3309 price level occurred at a time when the MACD indicator had already moved significantly above the zero line, which limited the pair's upward potential. Meanwhile, short positions taken on a rebound from 1.3354 allowed most of the corrective moves to be captured.

Attention now shifts to the upcoming U.S. Nonfarm Payrolls report for the previous month. This figure, one of the key indicators of economic activity, will help assess how strong job creation may influence future Federal Reserve decisions. The unemployment rate is also closely watched. Any changes in this indicator directly reflect the current state of the labor market and the economy's ability to absorb labor.

The June data are expected to provide a clearer picture of whether the downward trend in unemployment is continuing, or whether it is stabilizing or even increasing. This could signal potential selling pressure on the U.S. dollar and renewed buying interest in the British pound. Wage growth acceleration is also important, as it may signal an overheating labor market, while slower growth could indicate weaker employer confidence or more moderate inflation expectations, which is currently the Federal Reserve's goal.

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

Buy Signal

Scenario No. 1: I plan to buy the pound if the entry point at 1.3358 (green line on the chart) is reached, with a target of 1.3428 (thick green line on the chart). At 1.3428, I will exit long positions and consider opening shorts in the opposite direction, targeting a 30–35 point reversal. A strong pound rally today is only likely if U.S. data disappoint. Important: Before buying, ensure that the MACD is above the zero line and has just started rising from it.

Scenario No. 2: I also plan to buy the pound if there are two consecutive tests of 1.3324, while the MACD is in oversold territory. This would limit downward potential and trigger a bullish reversal. In this case, the expected upward targets are 1.3358 and 1.3428.

Sell Signal

Scenario No. 1: I plan to sell the pound after a breakdown below 1.3324 (red line on the chart), which would trigger a quick decline. The key target for sellers is 1.3256, where I will exit short positions and consider opening longs in the opposite direction, targeting a 20–25 point rebound. Selling pressure is likely to return if U.S. data come in strong. Important: Before selling, ensure that the MACD is below the zero line and has just started declining from it.

Scenario No. 2: I also plan to sell the pound if there are two consecutive tests of 1.3358, while the MACD is in overbought territory. This would limit upward potential and trigger a bearish reversal. In this case, the expected downward targets are 1.3324 and 1.3256.

Chart Guide

• Thin green line – Entry price for buy trades
• Thick green line – Suggested Take Profit level or area to manually secure profits, as further gains above this level are unlikely
• Thin red line – Entry price for sell trades
• Thick red line – Suggested Take Profit level or area to manually secure profits, as further declines below this level are unlikely
• MACD indicator – Pay attention to overbought and oversold zones when entering the market

Important: Beginner Forex traders should be very cautious when entering the market. Before major fundamental releases, it is best to stay out of the market to avoid sharp volatility. If you choose to trade during news releases, always use stop-loss orders to minimize losses. Without stop-loss protection, you may quickly lose your entire deposit, especially if you do not use proper risk management and trade large volumes.

Remember that successful trading requires a clear trading plan, such as the one outlined above. Spontaneous trading decisions based on current market conditions are generally a losing strategy for intraday traders.