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How to trade GBP/USD on June 10? Simple tips for beginners.

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Analysis of Thursday’s deals:

30M chart of the GBP/USD pair

The GBP/USD pair showed very weak volatility on Thursday – only 67 points. This is very little for the pound, but, on the other hand, there were no important events during the day. Thus, everything is natural. If the pair should leave the horizontal channel, then obviously it wouldn’t be today. Consequently, the technical picture has not changed at all over the past day. The pound is also not far from its local highs and not far from its 2-year lows. Therefore, from the current positions, it can easily and simply continue to grow, or it can just as easily and simply resume the global downward trend. We would like to say that everything will depend on macroeconomic statistics, but this is not so. Macroeconomic reports have only a small, local impact on the pair’s movement. Everything will depend on the mood of traders. In the meantime, the flat remains, so you need to trade the pair with this in mind.

5M chart of the GBP/USD pair

The movement was very bad on the 5-minute timeframe. There was not even an intraday trend, so it was very difficult to trade. In addition, the price constantly changed its direction of movement during the day and was located clearly in the middle of the horizontal channel. Fortunately, not a single trading signal was formed during the day, so the pair did not even approach any of the borders, so novice traders did not have to open deals. The European Central Bank meeting, its results and Christine Lagarde’s speech at the press conference had nothing to do with the pound and the dollar. Therefore, the movement, as in the European currency, did not happen. We also note that there are practically no local levels inside the horizontal channel, so beginners can only count on working out the boundaries of the horizontal channel and generating signals around them.

How to trade on Friday:

The upward trend is formally canceled on the 30-minute timeframe, however, the pair continues to remain close to its local peaks, which are located near the level of 1.2659. At this time, the pair is not exactly inside the horizontal channel at 1.2477-1.2597, and only an exit from it will signal the end of the flat. Moreover, overcoming any of the boundaries cannot guarantee the end of the flat. The traffic is very strange right now. On the 5-minute TF, it is recommended to trade at the levels 1.2371, 1.2471-1.2477, 1.2577, 1.2597-1.2616, 1.2659-1.2674. When the price passes after opening a deal in the right direction for 20 points, Stop Loss should be set to breakeven. No important events are scheduled for Friday in the UK, while an important inflation report will be published in the US, which might push traders to become more active. A secondary consumer sentiment report from the University of Michigan will also be released later in the evening, but this report can only trigger a market reaction if its value is very different from the forecast. In general, even the inflation report may not provoke a strong movement if its value does not differ from the forecast of 8.3% y/y.

Basic rules of the trading system:

1) The signal strength is calculated by the time it took to form the signal (bounce or overcome the level). The less time it took, the stronger the signal.

2) If two or more deals were opened near a certain level based on false signals (which did not trigger Take Profit or the nearest target level), then all subsequent signals from this level should be ignored.

3) In a flat, any pair can form a lot of false signals or not form them at all. But in any case, at the first signs of a flat, it is better to stop trading.

4) Trade deals are opened in the time period between the beginning of the European session and until the middle of the American one, when all deals must be closed manually.

5) On the 30-minute TF, using signals from the MACD indicator, you can trade only if there is good volatility and a trend, which is confirmed by a trend line or a trend channel.

6) If two levels are located too close to each other (from 5 to 15 points), then they should be considered as an area of support or resistance.

On the chart:

Support and Resistance Levels are the Levels that serve as targets when buying or selling the pair. You can place Take Profit near these levels.

Red lines are the channels or trend lines that display the current trend and show in which direction it is better to trade now.

The MACD indicator (14,22,3) consists of a histogram and a signal line. When they cross, this is a signal to enter the market. It is recommended to use this indicator in combination with trend lines (channels and trend lines).

Important speeches and reports (always contained in the news calendar) can greatly influence the movement of a currency pair. Therefore, during their exit, it is recommended to trade as carefully as possible or exit the market in order to avoid a sharp price reversal against the previous movement.

Beginners on Forex should remember that not every single trade has to be profitable. The development of a clear strategy and money management are the key to success in trading over a long period of time.

*The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.

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