On Monday, GBP/USD failed to extend its upward correction initiated on Friday. Instead, the pound sterling was sliding for the whole day. Although the quotes have left the descending channel, the downtrend still persists. At the moment, everything confirms a further decline in the pound and a rise in the US dollar. It is true that the fall in the pair has already been deep enough, and the market has priced in all the factors. Yet, it is not recommended to open new trades based on this. Today, there were no major reports or other important events in the UK, so the market had no drivers. However, as we can see, the pair did not need any external factors as it moved by almost 100 pips during the day. So the trend movement was strong.
On the 5-minute time frame, the pair was moving smoothly within the trend without sharp pullbacks or corrections. However, not a single trading signal was formed during the European session. So, beginners missed the trend unless they simultaneously used other trading systems and signals. The first signal was formed only in the middle of the US trading session when the pair rebounded from the level of 1.2502 with a 3-pip error. What is more, the signal turned out to be false. After its formation, the pair went up by only 13 pips, which was not enough even to set a Stop Loss to breakeven. Almost immediately, the price returned to the 1.2502 level and bounced off it again. So, if you had opened a buy trade before, it should have remained open. However, it could be closed manually already in an hour as it was getting late and there is usually no strong movement in the evening.
Trading tips on Tuesday:
On the 30-minute time frame, the downtrend is still in place. The pound has recently depreciated by 600 points, with only one day of correction after that. Therefore, the fall of the British currency can resume and continue at any time. On the 5-minute chart on Tuesday, it is recommended to trade at the levels of 1.2409, 1.2477, 1.2502, 1.2601, 1.2674, and 1.2697. Set a Stop Loss to breakeven as soon as the price passes 20 pips in the right direction after the trade is opened. Tomorrow, the UK will publish the business activity index in the manufacturing sector for April. It is unlikely to have any influence on the trajectory of the pair. In the US, the economic calendar is mostly uneventful. Therefore, we will have to rely entirely on technical analysis.
