Analysis of Friday's Trades

1H Chart of GBP/USD

On Friday, the GBP/USD pair traded rather weakly and uncertainly. We cannot definitively say that the downward trend has ended, but we also cannot say it has not. On the 4-hour time frame, a sideways range is still clearly visible, while the daily time frame shows a strong upward trend. Thus, we lean toward the view that the British currency is currently in a phase of sideways movement, with all the resulting implications. A significant drop in the pound sterling (i.e., a rise in the US dollar) is still unlikely, as no substantial factors support dollar growth. On Friday, UK data disappointed — the retail sales report for May turned out significantly weaker than expected. This is likely the reason the pound failed to rise during the day.

5M Chart of GBP/USD

No trading signals were formed on Friday in the 5-minute time frame. The total daily volatility was 71 pips, which is relatively low, and there was no trend movement. Therefore, we consider the absence of signals to be a positive factor. For comparison, three signals were generated on the EUR/USD pair, and none of them resulted in profit for traders.

Trading Strategy for Monday:

In the hourly time frame, the GBP/USD pair focuses on Donald Trump and remains quite skeptical of his policies. As a result, the market either continues to sell the dollar or waits for new negative developments from across the ocean to start selling the dollar again. This will likely continue until the market sees real signs of the trade war ending and Trump stops making decisions he lacks the authority to make — decisions that leave market participants stunned. The dollar may show some strength from time to time, as even it cannot fall every day. But such occurrences remain extremely rare for now.

On Monday, the GBP/USD pair may resume its upward movement as the downward trend appears to be over. At the same time, the macroeconomic background will play a significant role during the day.

On the 5-minute time frame, trading can now be done based on the following levels: 1.3043, 1.3102–1.3107, 1.3203–1.3211, 1.3259, 1.3329–1.3331, 1.3413–1.3421, 1.3518–1.3535, 1.3580–1.3592, 1.3643–1.3652, 1.3695, and 1.3740. On Monday, service and manufacturing PMIs will be published in both the United Kingdom and the United States, and these reports may influence the pair's movement throughout the day.

Core Trading System Rules:

1. Signal Strength: The shorter the time it takes for a signal to form (a rebound or breakout), the stronger the signal.
2. False Signals: If two or more trades near a level result in false signals, subsequent signals from that level should be ignored.
3. Flat Markets: In flat conditions, pairs may generate many false signals or none at all. It's better to stop trading at the first signs of a flat market.
4. Trading Hours: Open trades between the start of the European session and the middle of the US session, then manually close all trades.
5. MACD Signals: On the hourly timeframe, trade MACD signals only during periods of good volatility and a clear trend confirmed by trendlines or trend channels.
6. Close Levels: If two levels are too close (5–20 pips apart), treat them as a support or resistance zone.
7. Stop Loss: Set a Stop Loss to breakeven after the price moves 20 pips in the desired direction.

Key Chart Elements:

Support and Resistance Levels: These are target levels for opening or closing positions and can also serve as points for placing Take Profit orders.

Red Lines: Channels or trendlines indicating the current trend and the preferred direction for trading.

MACD Indicator (14,22,3): A histogram and signal line used as a supplementary source of trading signals.

Important Events and Reports: Found in the economic calendar, these can heavily influence price movements. Exercise caution or exit the market during their release to avoid sharp reversals.

Forex trading beginners should remember that not every trade will be profitable. Developing a clear strategy and practicing proper money management are essential for long-term trading success.