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Analysis of Macroeconomic Reports:
Several macroeconomic reports are scheduled for Tuesday, but they are not generating much interest at the moment. The market continues to show minimal volatility and no clear direction. The U.S. dollar continues to weaken very little, without sufficient grounds for it. However, the market is still not in a hurry to sell the U.S. currency. Today in Germany, the third estimate of GDP for the third quarter will be released, and in the U.S., the weekly ADP employment report, the Producer Price Index, and retail sales data will be released. These are interesting reports, but the market is expecting others. Traders are looking for Non-Farm Payrolls, the unemployment rate, and the Consumer Price Index for October and November, while the remaining data are of only secondary interest to them at this time.
Analysis of Fundamental Events:
A few fundamental events are scheduled for Tuesday, but they do not generate much interest. In the Eurozone, representatives of the European Central Bank, Chipollone, and Donnery will give speeches, but it is worth noting that there are currently no questions regarding monetary policy for the ECB. The central bank has managed to stabilize inflation around 2%, and the easing of monetary policy has ended with a 99% probability. Therefore, the ECB president's speeches currently hold little significance. There are no speeches planned from the representatives of the Federal Reserve or the Bank of England on Tuesday.
General Conclusions:
On the second trading day of the week, both currency pairs may show some movement, as the macroeconomic backdrop today will be quite weak and the market is not keen on trading anyway. The euro has a good trading range at 1.1527-1.1531. The British pound is trading in a range of 1.3096-1.3107 and is flat. Volatility in the market is currently low, despite the significance and volume of macroeconomic data, which is something to keep in mind.
Key Principles of My Trading System:
- The strength of the signal is considered based on the time taken to form the signal (bounce or breach of a level). The less time taken, the stronger the signal.
- If two or more trades have been opened around a certain level based on false signals, all subsequent signals from that level should be ignored.
- In a flat market, any pair can create numerous false signals or may not form them at all. In any case, it's best to stop trading at the first signs of a flat.
- Trading deals are opened during the period between the start of the European session and the middle of the American session, after which all deals should be closed manually.
- On the hourly timeframe, it is preferable to trade based on signals from the MACD indicator only when there is good volatility and a trend that is confirmed by a trend line or trend channel.
- If two levels are too close to each other (between 5 and 20 pips), they should be treated as an area of support or resistance.
- After a 15-20-pip move in the right direction, a Stop Loss should be set to breakeven.
What the Charts Show:
- Support and resistance price levels are targets for opening buy or sell positions. Take Profit levels can be placed around them.
- Red lines indicate trend channels or trend lines, reflecting the current trend and indicating the preferred trading direction.
- The MACD indicator (14,22,3) — histogram and signal line — is a supplementary indicator that can also be used as a source of signals.
Important announcements and reports (always available in the news calendar) can significantly impact the movement of the currency pair. Therefore, during their release, it is recommended to trade with maximum caution or to exit the market to avoid sharp reversals against the preceding movement.
Beginners trading on the Forex market should remember that not every trade can be profitable. Developing a clear strategy and money management is key to long-term success in trading.
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