FX.co ★ What to Pay Attention to on October 8? Analysis of Fundamental Events for Beginners

Analysis of Macroeconomic Reports:

Very few macroeconomic events are scheduled for Tuesday. The only notable report is on industrial production in Germany. This is not a significant report, so the market reaction may be weak or nonexistent. Overall, the euro and the pound declined last week, so this week (especially on days without significant macroeconomic or fundamental background), the market may lean toward an upward correction. This is especially true for the British pound, which in 2024 has fallen against the dollar much less frequently than the euro.

Analysis of Fundamental Events:

The main fundamental events on Monday include speeches by Federal Reserve representatives Raphael Bostic, Susan Collins, and Philip Jefferson. These could be interesting, as these officials may comment on last Friday's unemployment and Nonfarm Payrolls reports. We will likely hear statements suggesting that aggressive monetary policy easing by the Fed at the next meeting will not be necessary. However, the market will likely wait for the U.S. inflation report before drawing final conclusions on the Fed's decision in November. In the Eurozone, European Central Bank Vice President Luis de Guindos will be speaking, which could also be notable, as there have recently been regular dovish remarks within the ECB.

General Conclusions:

On the second trading day of the new week, the euro and pound may begin to correct. If yesterday the market continued to react to Friday's labor market and unemployment data from the U.S., that influence may wane today. Traders will have several "empty" days before the U.S. inflation report. The dollar is expected to rise in the medium term, but this does not mean it will avoid corrections or decline daily.

Basic Rules of the Trading System:

1. The strength of a signal is determined by the time it takes for the signal to form (bounce or break through the level). The less time it takes, the stronger the signal.
2. If two or more trades are opened around a certain level based on false signals, all subsequent signals from that level should be ignored.
3. In a flat market, any pair can generate many false signals or none at all. In any case, at the first signs of a flat market, it is better to stop trading.
4. Trading positions should be opened during the period from the start of the European session until the middle of the US session, after which all trades should be closed manually.
5. In the hourly time frame, it is recommended to trade based on MACD indicator signals only when there is good volatility and a trend confirmed by a trendline or trend channel.
6. If two levels are too close to each other (between 5 to 20 pips), they should be considered as a support or resistance zone.
7. Upon passing 15-20 pips in the intended direction, a Stop Loss should be set at breakeven.

What's on the Charts:

Support and Resistance Price Levels: These levels serve as targets when opening buy or sell positions. They can also be used as points to set Take Profit levels.

Red Lines: These represent channels or trend lines that display the current trend and indicate the preferred trading direction.

MACD Indicator (14,22,3): The histogram and signal line serve as a supplementary indicator that can also be used as a source of trading signals.

Important Speeches and Reports (always found in the news calendar) can significantly impact the movement of a currency pair. Therefore, trading should be done with maximum caution during their release, or you may choose to exit the market to avoid a sharp price reversal against the preceding movement.

For Beginners Trading on the Forex Market: It's essential to remember that not every trade will be profitable. Developing a clear strategy and practicing money management is key to achieving long-term success in trading.