The GBP/USD pair traded almost perfectly on Friday. We say this because the two key levels of the day - 1.3365 and 1.3440, were reached almost perfectly, forming several good signals. As we said earlier, there is no trend for the pound/dollar pair now. Before last Thursday's events, the price had been in the horizontal channel for a long time. The quotes crashed down on Thursday, but the movement of one day cannot be considered as a trend. Therefore, there is no trend line or channel at this time. They just don't make any sense, but there are also no reference points to build them. The pair's movement at the end of last week was as emotional as possible. And emotions continue to prevail in the foreign exchange market. Next week, the pair may continue to move as unpredictably as possible, under the influence of geopolitical factors. Thus, it is impossible to predict where the pair will move even with a 55% probability now. Therefore, we advise you to trade from the levels and follow the geopolitics as closely as possible.
On the 5-minute timeframe, you can clearly see how well the pair reached important levels on Friday. The price bounced from the area of 1.3431-1.3440 at the very beginning of the European trading session, thus forming a sell signal. Subsequently, the price reached the nearest target level of 1.3366 and bounced off it twice. Thus, it was possible to earn about 40 points on a short position. Then, it was possible to open two long positions near the level of 1.3366. Two – because the first trade closed at a Stop Loss, set at breakeven: the price went up more than 20 points, but then returned to 1.3366. But the second deal was more successful. The total price went up about 46 points, but, of course, it was not possible to take all these 46 points, since the pair did not reach the target level this time. However, the deal should have been closed manually in the late afternoon and closer to the end of the trading week. Therefore, it was possible to earn 20 points. As a result, Friday turned out to be a pretty good day for novice traders.
How to trade on Monday:
The pair left the horizontal channel on the 30-minute TF, but at the same time, despite the strongest drop in quotes, there is no trend now. There is no trend line, no channel. The fall of the pound can easily continue tomorrow with the same intensity. And the corrective movement may continue. Now it is as difficult as possible to predict the pair's movements, since the market is in shock. How long this shock will last largely depends on the events in Ukraine. On the 5-minute TF tomorrow, it is recommended to trade by levels 1.3310, 1.3342, 1.3366, 1.3431-1.3440, 1.3488, 1.3537, 1.3580. When the price passes after the opening of the transaction in the right direction, 20 points should be set to Stop Loss at breakeven. There are no interesting events planned for tomorrow in the UK, as well as in the US. But Monday can become a "day of working out news over the weekend." On Saturday and Sunday, many events and statements related to the geopolitical conflict in Eastern Europe took place in the world, so tomorrow the market can start working them out from the very night.
