At the start of the new week, we observed intriguing reports and subdued movements in the performance of the European currency. The pound is experiencing slightly more active trading, but there would have been fewer questions if it had also traded weakly. The EUR/USD pair has seen four important reports released, while the GBP/USD pair has only had two. However, both pairs are not exhibiting significant volatility in their trading, and the values of the reports have almost entirely aligned with the forecasts. As a result, we have not witnessed any major movements that would make us exclaim, "wow."
Today, there are minimal macroeconomic statistics. On Wednesday, only one relatively important ADP report is scheduled, which reflects changes in nonfarm sector employment. It is analogous to NonFarm Payrolls but holds less significance. It's important to note that the values of these two reports differ and contradict each other. As a result, the market usually places more reliance on Nonfarm Payrolls than ADP. We do not expect a strong reaction to this report, and no other significant reports are scheduled for today.
Analysis of fundamental events:As for fundamental events, there is nothing noteworthy on Wednesday. Occasionally, representatives of the ECB and the Fed give interviews. Still, these events need to be listed on the calendar, making it impossible to predict when a specific representative of a monetary committee will speak. Thus far, we have not received any extraordinary comments on monetary policy from the Fed or the ECB. The only notable information is about a potential pause by the ECB in September.
General conclusions:
On Wednesday, there is only one relatively important report in the United States and nothing else significant. Both currency pairs currently tend to decline, which seems reasonable. Therefore, we anticipate a decline in both pairs, which may be unimportant for intraday trading. Avoiding a flat market matters most; ideally, we would prefer higher volatility.
Key rules of the trading system:
The strength of a signal is determined by the time taken to form it (rebound or level breakthrough). A shorter formation time indicates a stronger signal.If two or more trades are opened near a specific level due to false signals, all subsequent signals from that level should be disregarded.In a flat market, any currency pair may produce numerous false signals or none at all. In such cases, it's best to halt trading at the first signs of a flat market.Trading positions should be opened between the start of the European session and the middle of the American session, and all trades should be closed manually.In the 30-minute timeframe, trades based on MACD indicator signals are viable only when there is sufficient volatility and a confirmed trend backed by a trend line or channel.If two levels are located too close to each other (within 5 to 15 points), they should be considered as a support or resistance zone.What's on the charts:
Price support and resistance levels serve as targets for initiating buy or sell positions and can also be utilized as Take Profit levels.
Red lines on the charts represent channels or trend lines that visually indicate the current trend and suggest the preferred trading direction.
The MACD indicator (14, 22, 3), with its histogram and signal line, acts as an additional tool that can be used as a source of trading signals.
Significant speeches and reports, which are always listed in the news calendar, have the potential to impact currency pairs' movements greatly. Therefore, when these events are released, traders should approach trading with the utmost caution, or they may consider exiting the market to avoid sudden price reversals against the prevailing trend.
For novice traders in the forex market, it is crucial to remember that not all trades will be profitable. Developing a clear trading strategy and effective money management is essential for achieving success in the long term.