Trade Review and Trading Tips for the British Pound

The test of the 1.3345 level occurred at a time when the MACD indicator had just started moving downward from the zero line, confirming the validity of the entry point for a pound short position. As a result, the pair declined towards the target level of 1.3317.

Despite a noticeable improvement in July retail sales according to the Confederation of British Industry (CBI) data, the pound declined significantly against the US dollar today. The CBI Retail Sales indicator is based on a survey of retailers and serves as an early signal of consumer demand conditions. An improvement in the indicator usually supports the British currency through expectations regarding Bank of England monetary policy. However, the actual reading remained in negative territory, indicating that sales are still declining, and therefore the data did not provide meaningful support for the pound.

As a result, the British currency became dependent on external factors, with market sentiment towards the US dollar becoming the main driver rather than domestic economic data.

During the second half of the day, the direction of the pound will be determined by US Durable Goods Orders data, as the British currency currently lacks additional domestic drivers. The indicator reflects demand for expensive goods with a long service life and is considered an early signal of investment activity. Rising orders typically indicate stronger business confidence and a healthy US economy.

Regarding the intraday strategy, I will primarily focus on implementing Scenario #1 and Scenario #2.

Buy Signal

Scenario #1:

Today, I plan to buy the pound if the entry point is reached near 1.3332 (green line on the chart), with a target of a rise towards 1.3356 (thicker green line on the chart). Around 1.3356, I will exit long positions and open short positions in the opposite direction, expecting a move of 30–35 points from the level. A rise in the pound today can only be expected if the economic data is weak.

Important: Before buying, make sure that the MACD indicator is above the zero line and has just started moving upward from it.

Scenario #2:

I also plan to buy the pound today if the price tests 1.3311 twice consecutively while the MACD indicator is in the oversold zone. This would limit the pair's downward potential and trigger a reversal higher. A move towards the opposite levels of 1.3332 and 1.3356 can be expected.

Sell Signal

Scenario #1:

Today, I plan to sell the pound after the 1.3311 level is broken (red line on the chart), which would trigger a rapid decline in the pair. The key target for sellers will be 1.3281, where I will exit short positions and immediately open long positions in the opposite direction, expecting a move of 20–25 points from the level. Downward pressure on the pound will ease today if the economic data is strong.

Important: Before selling, make sure that the MACD indicator is below the zero line and has just started moving downward from it.

Scenario #2:

I also plan to sell the pound today if the price tests 1.3332 twice consecutively while the MACD indicator is in the overbought zone. This would limit the pair's upward potential and trigger a reversal lower. A decline towards the opposite levels of 1.3311 and 1.3281 can be expected.

Chart Explanation

• Thin green line — the entry price at which the trading instrument can be bought.
• Thick green line — the estimated price level where Take Profit orders can be placed or profits can be manually taken, as further upward movement above this level is considered unlikely.
• Thin red line — the entry price at which the trading instrument can be sold.
• Thick red line — the estimated price level where Take Profit orders can be placed or profits can be manually taken, as further downward movement below this level is considered unlikely.
• MACD indicator — when entering the market, it is important to consider overbought and oversold zones.

Important: Beginner Forex traders should be extremely cautious when making market-entry decisions. Before the release of major fundamental reports, it is best to stay out of the market to avoid exposure to sharp price fluctuations. If you decide to trade during news releases, always use stop-loss orders to minimise losses. Without stop-loss protection, you can quickly lose your entire trading account, especially if you do not use proper money management and trade with oversized positions.

Remember that successful trading requires a clear trading plan, such as the one presented above. Making spontaneous trading decisions based on the current market situation is an inherently losing strategy for an intraday trader.