In the world of financial markets, trading the pound sterling against the dollar is among the most important currency pairs that traders and investors around the world passionately follow. The exchange rate of this pair is affected by multiple economic and political factors, which makes its analysis and forecasts of great importance to many traders.
Recently, the British pound has witnessed noticeable fluctuations against the US dollar, which raises many questions about its future. Therefore, in this article, we will provide a comprehensive analysis of the trading expectations for the pound sterling against the dollar, focusing on the main factors that may affect its direction in the coming period.
1. Monetary policy: The policies of the British Central Bank (Bank of England) and the US Federal Reserve play a major role in determining the strength of each currency. Decisions to raise or lower interest rates and monetary policy directions can significantly affect the value of the pound sterling against the dollar.
2. National economies: Economic factors such as GDP growth, unemployment rates, and inflation rates in the United Kingdom and the United States play an important role in determining the strength of the two currencies.
3. Political developments: Political tensions between the United Kingdom and the United States or in the world in general could affect fluctuations in the exchange rate of the pound sterling against the dollar.
4. Technical factors: Analyzing charts and technical analysis models can provide additional understanding about the direction of price movement.
5. Market expectations: Given the importance of the expectations factor in financial markets, we will also try to obtain experts’ opinions and analysts’ expectations about the direction of the pound sterling against the dollar in the coming period.
Use risk management strategies to protect capital
In the world of currency trading, risk management is one of the key factors to ensure sustainable success and capital protection. The lack of effective risk management strategies may result in significant loss of funds and deterioration of trading performance. In this article, we will present solid and proven strategies for efficient risk management and capital protection in the currency trading market.
1. Determine the amount of acceptable risk: It is necessary for each trader to determine the amount of risk he can bear based on the size of his capital and his investment goals. The trader must determine a certain percentage of capital that he is prepared to lose on each trade.
2. Determine the risk ratio for each deal: After determining the acceptable amount of risk, the trader must determine the risk ratio for each deal. It is recommended not to exceed 1-2% of the capital in each deal to ensure the preservation of capital in the long term.
3. Using stop loss orders: Stop loss orders are considered one of the most important tools in risk management in currency trading. The stop loss level is set before entering the trade, and the order is automatically executed when the price reaches this level, minimizing potential losses.
4. Diversifying investments: Diversifying investments is an effective strategy to reduce risks and protect capital. It is advisable to spread capital across several different currency pairs and several trading strategies to reduce exposure to individual market risks.
5. Monitor economic news and events: The trader must monitor economic news and geopolitical events that may affect the currency market. These events can lead to sharp price fluctuations, so risk management is a critical component of capital preservation.
Trade CFDs on GBP/USD
The GBP/USD currency pair, known as the Cable, is a major currency pair and one of the most traded pairs in the world. This pair represents the exchange rate between the British pound and the US dollar and is affected by a variety of factors, including economic indicators, political events, and global events such as natural disasters and geopolitical tensions. Investors can trade GBP/USD as well as other currencies through any Forex broker.
Forex trading involves speculating on the movement of exchange rates by buying one currency while selling another at the same time. The Forex market is the largest market in the world, with an average daily trading volume of more than $6 trillion. The value of the GBP/USD pair is affected by economic indicators such as inflation, interest rates, and GDP growth rate, as well as political events such as elections and trade negotiations. For example, if the Bank of England raises interest rates, demand for the pound may increase, causing the value of the GBP/USD currency pair to increase.
Trading GBP/USD using CFDs allows traders to speculate on the price movements of a currency pair without owning the underlying asset. CFDs provide flexibility in trading, with the ability to buy or sell a currency pair. While investing in the GBP/USD forex pair can provide opportunities for traders to profit from exchange rate fluctuations, it can also be risky as currency rates are constantly changing and can be affected by unexpected events
It is a good idea to carefully follow market developments and monitor the price response to potential support areas. The trading strategy may have to be updated based on new developments and changes in market trend.
Expected trading range for today:
• Support: $1.2520
• Resistance: $1.2630
