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Analysis of Macroeconomic Reports:
Several macroeconomic reports are scheduled for Thursday. First and foremost is the British data. Reports on Q3 GDP (first estimate) and industrial production will be published in the UK today. It is important to note that the first and third estimates of GDP are the most significant, as these can deviate from forecasts, potentially provoking a market reaction. The British economy continues to grow very weakly, and industrial production is facing significant challenges. Therefore, it will be difficult to expect strong support for the British currency today. In the Eurozone, an industrial production report will also be released, and the conclusions will be similar. In the US, inflation data for October was supposed to be published today, but the "shutdown" continues, so another American report is postponed to a later date.
Analysis of Fundamental Events:
There are relatively few fundamental events scheduled for Thursday. There will be further speeches from representatives of the European Central Bank's Monetary Committee, which are currently of no interest. The same goes for representatives of the Federal Reserve. The market is waiting for the end of the US "shutdown" and for all the missing statistics from the past month and a half. Besides, the ongoing technical flat will end when major players are ready for a new trend.
General Conclusions:
During the penultimate trading day of the week, both currency pairs may attempt to continue moving upward. New long positions on the euro will become relevant upon a rebound from the 1.1571-1.1584 area, targeting 1.1655. New long positions for the pound will become possible upon a price rebound from the area of 1.3096-1.3107. The growth of both currency pairs in recent days has been weak and unstable, so novice traders might also consider short positions.
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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