GBP/USD: Trading plan for the US session of June 5 (morning trading analysis). Sellers protected 1.2779 but – Prediction – June 6, 2024
In the morning forecast, we planned to pay attention to the 1.2779 level and make a decision to enter the market based on this. Let’s look at the 5-minute chart and see what happened. Here a false breakout occurred and formed, triggering a sell signal, but after a 12 point decline the pressure on the pound decreased. As long as the trade remains below 1.2779, the signal can be expected to work, but it all depends on US data. The technical situation in the second half of the year still needs to be revised.
To open a long GBP/USD position:
Only very strong data on ADP’s employment growth exceeding economists’ forecasts and ISM’s rise in US services sector business activity will lead to a fall in the pound and a return to yesterday’s lows. Advantages. A false breakout formation and pullback around the new support at 1.2746 will be the entry point for a buy position, looking for a return and update to 1.2779, which cannot be exceeded in the first half of the year. Only a breakout of this range and a reverse downward test would provide a suitable entry point to buy the pound, updating the next resistance at the monthly high of 1.2810. The furthest target will be the 1.2853 area where I plan to take profits. A decline in GBP/USD amid strong US statistics and a lack of bullish activity around 1.2746 will nullify all buyer efforts yesterday. This will also lead to a decline and update of the next support at 1.2721 formed late last week. Only false breakout formations are suitable for initiating a buy position. I plan to buy GBP/USD as soon as it rebounds from the low of 1.2695, targeting a 30-35 point correction within the day.
To open a short position on GBP/USD:
As long as the trade remains below 1.2779, the advantage remains with the seller. This could lead to a morning sell signal being realized, but as mentioned above, a lot depends on US statistics. If the data is weak, the bears should prove their case again around 1.2779. A false breakout formation similar to the one discussed above would confirm the presence of large sellers in the market and provide an entry point for short positions targeting a further decline in GBP/USD towards the 1.2746 support. A breakout and inverse test of this range would give the bears an advantage and provide another entry point for selling on the 1.2721 update, where a more active buyer presence is expected. The furthest target is at least 1.2695, which would trap the pair in a wide side channel. There I will profit. With GBP/USD rising and no weakness in the second half at 1.2779, buyers will have the opportunity to update 1.2810 to regain control. I will also only sell there on false breakouts. If there is no activity, a short position will be opened starting at GBP/USD 1.2853, with a downside correction of 30-35 points expected for the day.
