Analysis and trading tips for GBP/USD on May 5 (US session)
May 5, 2023 1:24 pm
Pound continued to rise, thanks to good PMI data from the UK construction sector. This is why there was a test of 1.2615, during which the MACD line had just began an upward movement, indicating a time to buy. This resulted in a price increase of about 20 pips.
A larger-than-expected increase in the number of employed in the US non-agricultural sector will lead to a decline in pound. But if the indicator decreases, along with the level of average hourly wages, the pair will see another rise.
Problems in the labor market will undoubtedly make the Fed seriously consider the future policy of interest rates.
For long positions:
Buy pound when the quote reaches 1.2617 (green line on the chart) and take profit at the price of 1.2667 (thicker green line on the chart). Weak US statistics will push pound to spike upwards, However, before buying, make sure that the MACD line is above zero and is starting to rise from it. Pound can also be bought after the level of 1.2569 is tested twice, but the MACD line should be in the oversold area as only by that will the market reverse to 1.2617 and 1.2667.
For short positions:
Sell pound when the quote reaches 1.2569 (red line on the chart) and take profit at the price of 1.2525. Pressure will return if there is very strong US data. However, before selling, make sure that the MACD line is below zero and is starting to drop down from it. Pound can also be sold after the level of 1.2617 is tested twice, but the MACD line should be in the overbought area as only by that will the market reverse to 1.2569 and 1.2525.
What’s on the chart:
Thin green line – entry price at which you can buy GBP/USD
Thick green line – estimated price where you can set Take-Profit (TP) or manually fix profits, as further growth above this level is unlikely.
Thin red line – entry price at which you can sell GBP/USD
Thick red line – estimated price where you can set Take-Profit (TP) or manually fix profits, as further decline below this level is unlikely.
MACD line- it is important to be guided by overbought and oversold areas when entering the market
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 decision 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
Pound continued to rise, thanks to good PMI data from the UK construction sector. This is why there was a test of 1.2615, during which the MACD line had just began an upward movement, indicating a time to buy. This resulted in a price increase of about 20 pips.
A larger-than-expected increase in the number of employed in the US non-agricultural sector will lead to a decline in pound. But if the indicator decreases, along with the level of average hourly wages, the pair will see another rise.
Problems in the labor market will undoubtedly make the Fed seriously consider the future policy of interest rates.
For long positions:
Buy pound when the quote reaches 1.2617 (green line on the chart) and take profit at the price of 1.2667 (thicker green line on the chart). Weak US statistics will push pound to spike upwards, However, before buying, make sure that the MACD line is above zero and is starting to rise from it. Pound can also be bought after the level of 1.2569 is tested twice, but the MACD line should be in the oversold area as only by that will the market reverse to 1.2617 and 1.2667.
For short positions:
Sell pound when the quote reaches 1.2569 (red line on the chart) and take profit at the price of 1.2525. Pressure will return if there is very strong US data. However, before selling, make sure that the MACD line is below zero and is starting to drop down from it. Pound can also be sold after the level of 1.2617 is tested twice, but the MACD line should be in the overbought area as only by that will the market reverse to 1.2569 and 1.2525.
What’s on the chart:
Thin green line – entry price at which you can buy GBP/USD
Thick green line – estimated price where you can set Take-Profit (TP) or manually fix profits, as further growth above this level is unlikely.
Thin red line – entry price at which you can sell GBP/USD
Thick red line – estimated price where you can set Take-Profit (TP) or manually fix profits, as further decline below this level is unlikely.
MACD line- it is important to be guided by overbought and oversold areas when entering the market
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 decision 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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