Macroeconomic Report Review:

Very few macroeconomic reports are scheduled again for Wednesday. Only the US Producer Price Index (PPI) stands out. Last month, this indicator posted a sensational figure of +0.9% against a forecast of 0.3%, which triggered a strong market reaction. However, in most cases, the actual value for this indicator differs little from the estimates. Therefore, today, a market reaction is only possible in the case of a second consecutive strong deviation. No important publications are scheduled today for the Eurozone, Germany, or the UK.

Fundamental Events Review:

There is absolutely nothing to highlight among fundamental events on Wednesday. Bank of England and Federal Reserve meetings will take place next week, so there's no reason to expect monetary policy comments from representatives of these central banks at the moment. Moreover, there are no doubts among traders about the expected rate decisions. The BoE is almost guaranteed to keep its rate unchanged due to high inflation. The Fed is almost guaranteed to cut the rate because of the weak labor market. Thus, the euro and pound still have every chance to continue strengthening against the US dollar.

General Conclusions:

During the third trading day of the week, both currency pairs may resume their upward movement. The euro and the pound both showed illogical declines yesterday, so today the market may seek to "restore justice." For any movement in the euro, new signals are needed, which may form in the areas of 1.1655–1.1666 and 1.1737–1.1745. The pound sterling is currently in the 1.3529–1.3543 area, so consolidation above or a bounce from this area will give novice traders a chance to enter the market.

Key Rules for the Trading System:

1. Signal Strength: The shorter the time it takes for a signal to form (a rebound or breakout), the stronger the signal.
2. False Signals: If two or more trades near a level result in false signals, subsequent signals from that level should be ignored.
3. Flat Markets: In flat conditions, pairs may generate many false signals or none at all. It's better to stop trading at the first signs of a flat market.
4. Trading Hours: Open trades between the start of the European session and the middle of the US session, then manually close all trades.
5. MACD Signals: On the hourly timeframe, trade MACD signals only during periods of good volatility and a clear trend confirmed by trendlines or trend channels.
6. Close Levels: If two levels are too close (5–20 pips apart), treat them as a support or resistance zone.
7. Stop Loss: Set a Stop Loss to breakeven after the price moves 15–20 pips in the desired direction.

Key Chart Elements:

Support and Resistance Levels: These are target levels for opening or closing positions and can also serve as points for placing Take Profit orders.

Red Lines: Channels or trendlines indicating the current trend and the preferred direction for trading.

MACD Indicator (14,22,3): A histogram and signal line used as a supplementary source of trading signals.

Important speeches and reports, which are consistently featured in the news calendar, can significantly influence the movement of a currency pair. Therefore, during their release, it is advisable to trade with caution or consider exiting the market to avoid potential sharp price reversals against the prior trend.

Beginners in the Forex market should understand that not every transaction will be profitable. Developing a clear trading strategy and practicing effective money management are crucial for achieving long-term success in trading.