The GBP/USD pair also traded lower on Friday and by the end of the day it was near the level of 1.3580, which it failed to overcome. But the main thing is that the price has rebounded again from the level of 1.3643, which is the upper limit of the assumed horizontal channel. Its lower limit is the level of 1.3488. Thus, the pound/dollar pair has been located between these two levels for several weeks, the distance between which is at least 150 points. The reason for the pound's decline on Friday could be anything. Given that there were no important publications in the US that day, and the only report on retail sales in the UK turned out to be positive, it is unlikely that macroeconomics somehow influenced the pair's movement. But a technical factor could play – a rebound from the level of 1.3643. A geopolitical factor could play a role, as the situation in the Donbas in Ukraine is escalating. Or maybe it's just a coincidence at all, since the price does not always move under the influence of any specific factors. Moreover, the movement was not so strong. The bad thing is that there is no trend at the moment. There is no trend line or channel.
The technical picture on the 5-minute timeframe looks both bad and not bad at the same time. On the one hand, there were good movements during the day. On the other hand, there were no good trading signals. The first buy signal was formed when the price rebounded from the level of 1.3603 at the very beginning of the European trading session. After that, it went up by around 30 points, and novice traders had to, at least, place Stop Loss orders at breakeven. As a high, they could get a small profit on a long position. The second sell signal turned out to be contradictory, since during the time when the 1.3598-1.3603 area was overcome, the price almost immediately turned out to be near the next level of 1.3580, from which a rebound eventually followed, which was already a buy signal. However, it was formed at a time when novice traders should have already left the market. It should not have been worked out. As a result, only one transaction should have been opened.
How to trade on Monday:
The upward trend was canceled on the 30-minute TF, but a downward trend was not formed instead. The pair has been between the levels of 1.3488 and 1.3643 for 13 days, so there is simply no trend right now. The fundamental, macroeconomic and geopolitical background currently does not provoke serious movements in the market. We do not know when this kind of movement will end. On the 5-minute TF, it is recommended to trade by levels 1.3488, 1.3563-1.3580, 1.3598-1.3603, 1.3652-1.3660. When the price passes after the transaction is opened in the right direction, 20 points should be set to Stop Loss at breakeven. Business activity indices in the service and manufacturing sectors are scheduled to be published in the UK tomorrow. The probability that the market will pay attention to this data is low. And there are no other macroeconomic publications scheduled for the day. Thus, we advise novice traders to pay attention to the geopolitical background. If important news arrives, it may affect the dollar exchange rate in all pairs.
