GBP/USD is one of the major pairs that gets heavily traded. GBP/USD pair is also known as the Cable. GBP/USD pair is affected by the interest rate differential between the Bank of England (BoE) and the Federal Reserve (FED). GBP/USD pair tends to have a positive correlation with EUR/USD and a negative correlation with USD/CHF. For example, a few days back this pair was trading in tandem with the EUR/USD pair.
Many traders trade GBP/USD and EUR/USD. They need to keep the positive correlation between the two currency pairs in view when trading both these pairs together. There are many strategies to trade the GBP/USD pair. Some are heavily based on the London Market Open as this pair normally starts trading in a range a few hours before the London Market open and tends to make a breakout after the London market open.
However, this is a very simple GBP/USD forex strategy that will not make you rich. It can only make 20 pips in day. But the good thing about this strategy is that it does not entail doing any complicated fundamental analysis or technical analysis.
The first thing that you need to do while trading with this strategy is to note the difference between your terminal time and the GMT. You should know the difference between your terminal time and the GMT. This strategy uses GBP/USD 15 Minute Chart.
Daily open the GBP/USD 15 Minute Chart after or before 0.15 GMT. Note the closing price of the candle that starts at 0.15 GMT and closes at 0.300 GMT. This closing price is your base price.
Now, place two pending orders. One Pending Buy Stop Order 50 pips above the base price and another Pending Sell Stop Order 50 pips below the base price. Take profit for both orders will also be 20 pips and the stop loss for both the orders will also be 20 pips. So the risk/reward ratio of both the trades will be 1:1.
You will find at least one pending order getting opened daily. Delete the other pending order that didn’t get opened. If none of the orders get opened in the next 24 hours delete them the next day before entering two new pending orders.
This is it. There is no complicated technical analysis involved. Practice this GBP/USD forex strategy on your demo account and note the win rate. If you are in a time zone where you can easily open the GBP/USD 15 minute chart at 0.15 GMT, you will find it to be a very simple way to make 20 pips daily. You can also automate this strategy with an Expert Advisor.