Details of the economic calendar from August 3
The producer price index in Europe for June was released on Tuesday, August 3, where the indicators coincided with the forecasts, which did not affect the market in any way.
We study and analyze
Producer price index is the change in the price of goods produced within the European Union and sold on the domestic market in the reporting month compared to the same month of the previous year.
The data is prepared by the statistical office of the European Union (Eurostat), which collects statistics from all countries every month by surveying a sample of several thousand manufacturing enterprises.
Analysis of trading charts from August 3
The Euro/Dollar currency pair has been in the range of 1.1850/1.1900 for 48 hours, which is very similar to the process of accumulation of trading forces. Please note that this stagnation occurred at the peak of the corrective course of 1.1750 - - - > 1.1900, which may signal a change of trading interests in the market.
Thus, market participants consider price stagnation as leverage.
The trading plan of August 2 and 3 was a scenario that came from the boundaries of 1.1850/1.1900 momentum and could well indicate a movement in the market.
The Pound/Dollar currency pair during the corrective movement from the psychological level of 1.4000 reached the level of 1.3900, where first there was a price stagnation, and then a pullback.
The trading plan of August 3 showed a further weakening of the pound sterling, where the quote needed to keep market participants below the 1.3900 mark, otherwise, a rebound could occur, which happened as a result.
We study and analyze
• The process of accumulation of trading forces is a price fluctuation in a closed amplitude, where at the moment of a breakdown of one or another stagnation boundary, a local acceleration in the direction of breakdown occurs.
• Psychological levels are round values (1,2000,1,3000, 1,4000,1,5000, etc.) that serve as key coordinates in the market and which traders pay special attention to. These levels are often used as support or resistance.
Economic calendar for August 4
Today, in terms of the economic calendar, data on retail sales in Europe will be published, where their volume in June may decrease from 4.6% to 1.7%.
Publication time: 09:00 UTC
We study and analyze
• The volume of retail sales is one of the main economic indicators, which is an indicator of changes in the volume of sales in the context of retail trade. Thus, this indicator reflects the purchasing power of the population.
The growth in retail sales is a positive signal for the economy and, as a result, the growth of the national currency. The decline in retail sales is a negative signal that leads to a weakening of the national currency.
During the US trading session, the ADP report in the United States for July is expected, where the employment rate in the private sector is expected to rise, which positively affects the entire economy and is a good signal for the forthcoming report of the Department of Labor.
Publication time: 12:15 UTC
We study and analyze
• The ADP Employment Report shows the change in the number of workers in the United States. The growth of the indicator has a positive effect on the unemployment rate in the country, as well as on consumer activity, which, in turn, has an impact on economic growth.
Trading plan - EURO/DOLLAR (August 4)
Analyzing the current Euro/Dollar trading chart, you can see that the price range of 1.1850/1.1900 is still relevant in the market, trading tactics for a breakdown of one or another border of the established stagnation is considered the most optimal in a given period of time.
The trading plan considers two possible scenarios.
The first scenario considers the subsequent downside movement, where holding the price below 1.1850 will open the way in the 1.1800 direction.
The second scenario considers the prolongation of the corrective move, in which case the quote must hold above 1.1900, which will open the way towards the psychological level of 1.2000.
Trading Plan - POUND/DOLLAR (August 4)
Analyzing the current Pound/Dollar trading chart, you can see how market participants are squeezed between two reference levels, putting pressure on both long and short positions.
In this situation, you can work by the method of rebounding from a particular level, depending on where the quote came up, and how to use the breakout method as the most profitable trading tactic.
When considering trading tactics for a breakout, the following point should be taken into account: when working for a fall, the price should be kept below 1.3870, which will open the way in the direction of 1.3800. When considering buy positions, the price should be held higher than 1.4000 over a four-hour period.
What is reflected in the trading charts?
The candlestick chart view is represented by white and black graphic rectangles with lines at the top and bottom. With a detailed analysis of each individual candle, you can see its characteristics relative to a particular time period: open price, close price, high and low prices.
Horizontal levels are price coordinates, relative to which a stop or price reversal may occur. In the market, these levels are called support and resistance.
Circles and rectangles are highlighted examples where the price of history has reversed. This highlighting in color indicates horizontal lines that may put pressure on the quote in the future.
The up/down arrows are indications of the possible direction of the price in the future.
IMPORTANT TO REMEMBER
Golden Rule: Before you start trading with real money, you need to figure out what you are dealing with. Training to trade is important for novice traders because the market is constantly in dynamics and it is important to understand what is happening on it.