07.04.202607:13 Forex Analysis & Reviews: What to Pay Attention to on April 7? Analysis of Fundamental Events for Beginners

Analysis of Macroeconomic Reports:

There are very few macroeconomic reports planned for Tuesday. Essentially, the only notable report is the durable goods orders in the US. In Germany, the UK, and the EU, second estimates of the services PMI for March will be released. What are the chances the market will notice these reports, especially given that it ignored Non-Farm Payrolls, unemployment rates, and the ISM index over the last two trading days?

Analysis of Fundamental Events:

Among the fundamental events on Tuesday, the speeches by Federal Reserve representatives Austan Goolsbee and Thomas Jefferson stand out; however, the market continues to ignore all factors unrelated to geopolitics. Last night, Donald Trump once again made threats against Iran and reminded that America could strike the country on Tuesday if Tehran does not unblock the Strait of Hormuz and does not sign a deal with the US. Given that Iranian officials have even stopped commenting on Trump's statements, we assume that Iran is preparing for an attack on its territory and a retaliatory strike against its adversary. Yesterday, official representatives of Tehran indicated the target – the largest AI data center in Abu Dhabi. Thus, central banks' monetary policy is currently of no interest to anyone.

General Conclusions:

During the second trading day of the week, both currency pairs can trade in any direction as the market continues to react solely to geopolitical news, which is impossible to predict. The euro can be traded today in the range of 1.1527-1.1531, while the British pound can be traded in the ranges of 1.3175-1.3180 and 1.3259-1.3267. We still do not see any grounds for a strong and prolonged rise in the American currency (if we take into account all factors, not just geopolitics), but in the near future, geopolitics will remain the key factor in the currency market.

Key Principles of the Trading System:

1. The strength of the signal is determined by the time it took to form the signal (bounce or level breakthrough). The shorter the time, the stronger the signal.
2. If two or more trades were opened around any level based on false signals, all subsequent signals from that level should be ignored.
3. In a range, any pair can generate a lot of false signals or may not generate them at all. Technical levels may be ignored.
4. On the hourly timeframe, it is advisable to trade signals from the MACD indicator only when there is good volatility and a trend that is confirmed by a trendline or trend channel.
5. If two levels are located too close together (5-20 pips apart), they should be considered a support or resistance area.
6. After moving 15 pips in the correct direction, a Stop Loss should be set to breakeven.

What to Look for on the Charts:

Price levels of support and resistance are levels that serve as targets when opening buys or sells. Take Profit levels can be placed around them.

Red lines represent channels or trend lines that show the current trend and indicate the direction in which it is preferable to trade now.

The MACD indicator (14,22,3) – the histogram and the signal line – is a supporting indicator that can also be used as a source of signals.

Important speeches and reports (always included in the news calendar) can significantly affect the movement of the currency pair. Therefore, during their release, trading should be done with utmost caution, or traders should exit the market to avoid sharp price reversals against the previous movement.

Beginning traders in the forex market should remember that not every trade can be profitable. Developing a clear strategy and effective money management are the keys to long-term trading success.