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08.01.202515:57 Forex Analysis & Reviews: GBP/USD: Simple Trading Tips for Beginner Traders on January 8th (U.S. Session)

Analysis of Trades and Tips for Trading the British Pound

The test of the 1.2476 price during the first half of the day occurred when the MACD indicator was just starting to move downward from the zero mark, confirming a valid entry point for selling the pound. As a result, the pair fell by more than 40 points.

The pound has sharply declined against the dollar without any apparent immediate reasons. It's possible that today's release of the FOMC meeting minutes could increase pressure on the pair, as it may highlight trends already known to the market, such as caution about further monetary policy easing. However, the tone of the statements will be crucial in determining the degree of consensus among committee members. If the minutes confirm that most officials lean toward a more conservative approach, it could heighten expectations for maintaining current rates. These expectations may strengthen the dollar further, particularly against the pound, which is currently facing challenges due to the Bank of England's more dovish stance.

For intraday strategy, I will focus on Scenarios #1 and #2.

Exchange Rates 08.01.2025 analysis

Buy Signal

Scenario #1: I plan to buy the pound today at the entry point around 1.2364 (green line on the chart) with a target rise to 1.2419 (thicker green line on the chart). Around 1.2419, I intend to exit purchases and open sell positions in the opposite direction (targeting a 30–35 point movement downward). The pound's rise today can only be expected after weak US data.Important: Before buying, ensure the MACD indicator is above the zero mark and just starting its upward movement.

Scenario #2: I also plan to buy the pound today in the case of two consecutive tests of the 1.2309 price level, with the MACD indicator in the oversold zone. This would limit the pair's downward potential and lead to a market reversal upward. Growth to opposite levels of 1.2364 and 1.2419 can be expected.

Sell Signal

Scenario #1: I plan to sell the pound after breaking the 1.2309 level (red line on the chart), which would lead to a quick decline in the pair. The key target for sellers will be 1.2267, where I plan to exit sales and immediately open purchases in the opposite direction (targeting a 20–25 point movement upward). Sellers are likely to act if US data is strong.Important: Before selling, ensure the MACD indicator is below the zero mark and just starting its downward movement.

Scenario #2: I also plan to sell the pound today in the case of two consecutive tests of the 1.2364 price level, with the MACD indicator in the overbought zone. This would limit the pair's upward potential and lead to a market reversal downward. A decline toward the opposite levels of 1.2309 and 1.2267 can be expected.

Exchange Rates 08.01.2025 analysis

What's on the Chart:

  • Thin green line: Entry price for buying the trading instrument.
  • Thick green line: Estimated price for setting Take Profit or manually closing positions, as further growth beyond this level is unlikely.
  • Thin red line: Entry price for selling the trading instrument.
  • Thick red line: Estimated price for setting Take Profit or manually closing positions, as further decline beyond this level is unlikely.
  • MACD Indicator: Key for identifying overbought and oversold zones when entering the market.

Important Notes for Beginner Traders:

Beginner Forex traders should exercise extreme caution when deciding to enter the market. Before the release of important fundamental reports, it's best to stay out of the market to avoid sharp price fluctuations. If you decide to trade during news releases, always set stop orders to minimize losses. Without stop orders, you can quickly lose your entire deposit, especially if you trade large volumes without applying money management principles.

Lastly, remember that successful trading requires a clear trading plan, like the one outlined above. Spontaneous trading decisions based on current market conditions are inherently a losing strategy for intraday traders.

*El análisis de mercado publicado aquí tiene la finalidad de incrementar su conocimiento, más no darle instrucciones para realizar una operación.

Jakub Novak,
Analytical expert of InstaSpot
© 2007-2025
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