Analysis of Macroeconomic Reports:

Several macroeconomic releases are scheduled for Thursday. In the United Kingdom, data on unemployment, jobless claims, and wages will be published. However, it's worth noting that the market ignored yesterday's inflation report, even though it was significant. Therefore, there is no certainty that today's British data will be priced in. The economic calendar is empty in both the Eurozone and Germany, while the United States will release a retail sales report. We believe there may be some reaction to all of these reports, but it is unlikely to be strong.

Analysis of Fundamental Events:

Among Thursday's fundamental events, the scheduled speeches by Federal Reserve Monetary Policy Committee members Adriana Kugler and Christopher Waller stand out. However, as we have already mentioned, the Fed's position on monetary policy remains unchanged, despite the acceleration of inflation in the U.S. The pickup in inflation fully supports the stance taken by Jerome Powell and his colleagues. Therefore, one should not expect any monetary policy easing by the Fed before mid-autumn.

The primary focus for the market remains the trade war, for which we still see no signs of resolution. The situation remains quite tense, as Donald Trump has managed to conclude only three trade deals, one of which is highly questionable. Over the past week and a half, the U.S. President has once again decided to increase tariffs on countries that are reluctant to negotiate with Washington, while also raising import duties on copper, pharmaceuticals, and semiconductors. As we can see, the situation is not improving over time. Therefore, the current rise in the dollar should not be misleading.

Conclusions:

On the penultimate trading day of the new week, both currency pairs may trade sluggishly, as there are few major events today. Technical corrections continue, but could end at any moment. Both currency pairs have formed descending trendlines, and breaking above them would signal a resumption of the six-month-long upward trend.

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.