09.09.202605:54 Forex Analysis & Reviews: How to Trade the EUR/USD Currency Pair on September 9? Simple Tips and Trade Review for Beginners

Trade review of Tuesday:

1H chart of the EUR/USD pair

The EUR/USD currency pair continued to trade sideways on Tuesday with minimal volatility. Throughout the day, we saw no price impulse, and the fundamental and macroeconomic backdrop was essentially absent. The market had nothing to react to (again). For about a month, traders have focused only on the most important reports and events, and even those do not always guarantee volatility. So this week, we will likely wait again for Thursday and Friday — the European Central Bank meeting and Christine Lagarde's press conference in the eurozone, and the US inflation report. Overall, the euro still has good chances to rise even locally. The descending trendline has been breached, so the trend has shifted upward. However, the market may still not show the needed moves even by week's end. Volatility has been very low for roughly six weeks.

5M chart of the EUR/USD pair

On the 5-minute TF on Tuesday, no trading signals were generated. Price did not approach important levels or zones during the day, so novice traders had no grounds to open positions.

How to trade on Wednesday:

On the hourly timeframe, EUR/USD continues a correction after a month-long rise. Considering recent months' events, we believe the euro should continue steady growth even without local support. The US dollar currently has no growth drivers apart from the market's near-religious faith in a Federal Reserve rate hike — and that faith is visibly fading.

On Wednesday, novice traders may consider short positions targeting 1.1584–1.1594 if price bounces from 1.1655–1.1665. Long positions can be held with targets of 1.1655–1.1665 after a bounce from 1.1584–1.1594 that began on Friday.

On the 5-minute TF, consider the levels 1.1366–1.1377, 1.1461–1.1474, 1.1527–1.1531, 1.1584–1.1594, 1.1655–1.1665, 1.1745–1.1754, 1.1830–1.1837. Lagarde will speak in the eurozone on Wednesday, but one day before the ECB meeting, she is unlikely to disclose material information. She will most likely avoid discussing monetary policy in detail.

Key Rules of the Trading System:

1. The strength of a signal is determined by the time it takes to form the signal (rebound or breakout). The less time taken, the stronger the signal.
2. If two or more trades were opened at a certain level based on false signals, all subsequent signals from that level should be ignored.
3. In a range (flat), any pair can generate many false signals or may not produce any at all. Technical levels may be disregarded.
4. On the hourly timeframe, trading signals from the MACD indicator should be acted upon only when volatility is high, and a trend line or trend channel confirms the trend.
5. If two levels are too close together (within 5-20 pips), treat them as a support or resistance area.
6. After moving 15 pips in the right direction, a stop-loss should be set to break even.

What to Look for on the Charts:

Price levels (areas) of support and resistance serve as targets for opening buy or sell trades or as sources of signals.

Red lines indicate channels or trend lines that show the current trend and the preferred trading direction.

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

Important speeches and reports (listed in the news calendar) can significantly influence currency pair movements. Therefore, during their release, traders should approach trading with utmost caution, or exit the market to avoid sudden reversals against the preceding move.

Beginner forex traders should remember that not every trade can be profitable. Developing a clear strategy and practicing money management are key to long-term success in trading.