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14.11.202408:03 Forex Analysis & Reviews: How to Trade the GBP/USD Pair on November 14? Simple Tips and Trade Analysis for Beginners

Relevance up to 00:00 2024-11-15 UTC--5

Analysis of Wednesday's Trades:

1H Chart of GBP/USD Pair

Exchange Rates 14.11.2024 analysis

On Wednesday, the GBP/USD pair continued its downward movement, showing no signs of correction. Similar to the euro, only one report could have influenced buyers or sellers yesterday. In reality, it supported neither. The U.S. Consumer Price Index matched market expectations, leaving no significant reason for the market to react. However, the market once again demonstrated that the current situation is not driven by U.S. inflation or the Federal Reserve's upcoming decision in December. Instead, the market continues to rebalance the dollar's exchange rate—a trend we predicted throughout the year's first half. The British pound rose similarly for two years, often without justification, while the market ignored numerous factors favoring the U.S. dollar. We are witnessing a logical decline in the pound and the strengthening of the dollar. This has nothing to do with Trump.

5M Chart of GBP/USD Pair

Exchange Rates 14.11.2024 analysis

Some levels were also revised on Wednesday in the 5-minute timeframe. The price bounced three times from the 1.2754 level, dropping to the 1.2680–1.2685. Although it failed to break below this zone on the first attempt, it may not hold today. Thus, we currently see no signs of even a minor upward correction. The pound can easily continue its decline.

How to Trade on Thursday:

In the hourly time frame, GBP/USD continues to trend downward. Over the past few weeks, we observed a flat movement between 1.2860 and 1.3043, but this range broke on Tuesday. We fully support the pound's decline in the medium term, as it appears to be the only logical direction. While the pound may attempt another correction soon, it will require strong support to materialize.

On Thursday, novice traders can anticipate the downward movement persisting if the price breaks below the 1.2680–1.2685 area. The price has already consolidated slightly below this zone.

On the 5-minute TF, you can now trade at 1.2547, 1.2633, 1.2680-1.2685, 1.2754, 1.2791-1.2798, 1.2848-1.2860, 1.2913, 1.2980-1.2993, 1.3043. On Thursday, the UK's economic calendar is empty, while the U.S. will release a few reports unlikely to impact market sentiment significantly. Powell's speech will carry more weight, but how could Powell possibly help the euro or the pound?

Basic Trading System Rules:

  1. The strength of a signal is determined by the time it takes to form (whether a bounce or breakthrough of a level). The quicker the formation, the stronger the signal.
  2. If two or more trades have been made near a level due to false signals, any further signals from that level should be ignored.
  3. In a flat market, a pair can generate many false signals or none at all. In any case, it's best to stop trading at the first signs of a flat market.
  4. Trading occurs between the start of the European and middle of the US sessions, after which all trades should be manually closed.
  5. On the hourly time frame, it's recommended to trade MACD indicator signals only when there is good volatility and a trendline or trend channel confirms a trend.
  6. If two levels are too close together (5 to 20 pips apart), they should be treated as support or resistance areas.
  7. After the price moves 20 pips in the intended direction, set the Stop Loss to breakeven.

What's on the Charts:

Support and Resistance Levels: Levels that serve as targets for opening buys or sells. Take Profit levels can be placed around these areas.

Red Lines: Channels or trend lines that indicate the current trend and the preferred trading direction.

MACD Indicator (14,22,3): Histogram and signal line—an auxiliary indicator that can also be used as a source of signals.

Major speeches and reports (always found in the news calendar) can significantly impact currency pair movements. Therefore, it's advised to trade cautiously or exit the market during their release to avoid sharp price reversals against prior movements.

Beginners trading on the forex market should remember that not every trade will be profitable. A clear strategy and money management are the keys to success in long-term trading.

*A análise de mercado aqui postada destina-se a aumentar o seu conhecimento, mas não dar instruções para fazer uma negociação.

Paolo Greco,
Analytical expert of InstaSpot
© 2007-2024
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