The GBP/USD pair continued to trade inside the side channel on Tuesday, which is perfectly visible in the chart above. During the day, the pair was practically flat, although the volatility was still quite high - at least 80 points. For a day with an empty calendar of events, this is quite a lot. However, the key point right now is the lateral channel. Recall that a side channel has also been formed for the euro, so both major pairs are now in a flat, confirming their high correlation with each other. Thus, the pound sterling continues to remain close to its 2-year lows and, just like the euro currency, cannot correct itself in any way. Based on this, one should wait for one of the borders of the side channel to be overcome to determine the further trend. There were no important macroeconomic reports or fundamental events on Tuesday. There was nothing for traders to react during the day.
On the 5-minute timeframe, only one trading signal was formed on Tuesday. The price bounced off the level of 1.2379 with a loss of 4 points and formed a sell signal. 4 points is actually a lot to consider this "under-rebound" as a signal. Thus, novice traders had to decide for themselves whether to open short positions or not. If the deal was opened, then it was possible to earn about 50 points on it. The price during the day failed to reach the nearest target level of 1.2250, so the deal had to be closed manually in the late afternoon. If the transaction was not opened, then no profit and no loss was received.
How to trade on Wednesday:
On the 30-minute timeframe, the downward trend still persists. The pound has recently fallen in price by 700 points, and all his attempts to form a tangible correction ended in nothing. Even the growth of the British currency on Monday by 150 points cannot be considered a correction. So far, the pair cannot even overcome the level of 1.2409, let alone anything more. But now you still need to get out of the side channel before counting on a new trend movement. On the 5-minute TF tomorrow it is recommended to trade at the levels of 1.2250, 1.2409, 1.2477, 1.2502. 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 tomorrow in the UK, and an important inflation report will be published in the US. We believe that the market may react quite violently to this report, so you need to be prepared for this.
