Analysis of Friday's Trades:

1H Chart of the GBP/USD Pair

On Friday, the GBP/USD pair also failed to continue its upward movement, bouncing off the new level of 1.3587 for the third time. Recall that on Friday, Donald Trump announced the opening of the Strait of Hormuz, and this was essentially the only event of the day. However, after the initial market reaction with purchases of the British pound, the price reversed, and the day ended 100 pips lower. Over the weekend, it became known that the Strait of Hormuz remained blocked, that an agreement between Iran and the US was still far off, that negotiations would resume on Monday, and that the US could strike Iran again by Wednesday if the deal was not agreed upon. However, the market is in a position where there is no certainty about further declines or increases. The situation in the Middle East is constantly changing, so the market may decide to stop reacting to every report and news item. Therefore, it is best to trade intraday from existing levels and areas.

5M Chart of the GBP/USD Pair

On the 5-minute timeframe, two trading signals were formed on Friday. The first buy signal was neither unprofitable nor false, but the unexpected price reversal spoiled the trade for traders. The second sell signal was formed too late in the day—almost just before the market closed.

How to Trade on Monday:

On the hourly timeframe, the GBP/USD pair continues to form an upward trend. There are no global grounds for medium-term dollar growth, so we expect a resumption of the overall upward trend from 2025 in 2026. For this to happen, geopolitical tensions worldwide need to continue to ease. However, we believe that without a significant escalation in the Middle East, the dollar will no longer be able to sustain its growth over the past two months.

On Monday, beginner traders could open short positions if the price settles below the 1.3476-1.3489 area, targeting 1.3380-1.3386. A price bounce from the area of 1.3476-1.3489 allows for opening long positions with targets of 1.3587-1.3598.

On the 5-minute timeframe, trading can currently take place at levels 1.3175-1.3180, 1.3259-1.3267, 1.3319-1.3331, 1.3380-1.3386, 1.3476-1.3489, 1.3587-1.3598, 1.3695, 1.3741-1.3751. Today, there are no significant events or reports scheduled in the UK and the US. Thus, the hope rests solely on geopolitical news. Volatility on the first trading day of the week, with no strong geopolitical influences, will be low.

Key Principles of the Trading System:

1. The strength of the signal is determined by the time it took to form the signal (bounce or level breakthrough). The shorter the time, the stronger the signal.
2. If two or more trades were opened around any level based on false signals, all subsequent signals from that level should be ignored.
3. In a range, any pair can generate a lot of false signals or may not generate them at all. Technical levels may be ignored.
4. On the hourly timeframe, it is advisable to trade MACD signals only when volatility is good, and the trend is confirmed by a trendline or trend channel.
5. If two levels are located too close together (5-20 pips apart), they should be considered a support or resistance area.
6. After moving 15 pips in the correct direction, a Stop Loss should be set to breakeven.

What to Look for on the Charts:

Price levels of support and resistance are levels that serve as targets when opening buys or sells. Take Profit levels can be placed around them.

Red lines represent channels or trend lines that show the current trend and indicate the direction in which it is preferable to trade now.

The MACD indicator (14,22,3) – the histogram and the signal line – is a supporting indicator that can also be used as a source of signals.

Important speeches and reports (always included in the news calendar) can significantly affect the movement of the currency pair. Therefore, during their release, trading should be done with utmost caution, or traders should exit the market to avoid sharp price reversals against the previous movement.

Beginning traders in the forex market should remember that not every trade can be profitable. Developing a clear strategy and effective money management are the keys to long-term trading success.