Analyzing Monday's trades:

EUR/USD on 30M chart

EUR/USD continued to trade in a horizontal channel. The only thing that you can take note of is that the limits for the horizontal channel from earlier were 1.0587 and 1.0657, and now they are 1.0587 and 1.0736. The horizontal channel isn't very narrow, but it's clear that we are in the channel. The volatility of the pair remains quite low. There were no important reports on Monday, only the EU manufacturing activity index for December was released in the final estimate. The chart above perfectly shows that there was no significant reaction to this report. Most likely traders will not react to many other business activity indexes which are scheduled for release this week as well. Thus, the movement might be very slow until we reach Friday (when Nonfarm and the US unemployment will be published).

EUR/USD on M5 chart

Beginners have been very lucky with EUR/USD lately, and we were lucky on Monday as well. In the chart above, you can see how well the levels were estimated during the day. This suggests that the levels I've chosen are correct. During the European session, the price rebounded from 1.0668 and 1.0697 three times, so each of these signals was profitable. Although, it was hardly possible to get more than 10 points at each trade, but that's better than if the signals were false and there were losses, which is absolutely normal in a flat. At the end of the trading day, the pair fell to the area of 1.0657-1.0668, but there was no signal formed there.

Trading tips on Tuesday:

EUR/USD left the 1.0587-1.0657 horizontal channel on the 30-minute chart, but that doesn't mean that the flat is over. It only means that the channel has expanded. The euro is still gravitating towards growth, but for now we have a flat. And this flat may persist until Friday. On the 5-minute chart on Tuesday, it is recommended to trade at the levels 1.0465-1.0483, 1.0536, 1.0587-1.0607, 1.0657-1.0668, 1.0697, 1.0736, 1.0787, 1.0806. As soon as the price passes 15 pips in the right direction, you should set a Stop Loss to breakeven. The index of business activity in the manufacturing sector for December in its final assessment will be published in America. I don't expect the market to react to this report.

Basic rules of the trading system:

1) The strength of the signal is determined by the time it took the signal to form (a rebound or a breakout of the level). The quicker it is formed, the stronger the signal is.

2) If two or more positions were opened near a certain level based on a false signal (which did not trigger a Take Profit or test the nearest target level), then all subsequent signals at this level should be ignored.

3) When trading flat, a pair can form multiple false signals or not form them at all. In any case, it is better to stop trading at the first sign of a flat movement.

4) Trades should be opened in the period between the start of the European session and the middle of the US trading hours when all positions must be closed manually.

5) You can trade using signals from the MACD indicator on the 30-minute time frame only amid strong volatility and a clear trend that should be confirmed by a trendline or a trend channel.

6) If two levels are located too close to each other (from 5 to 15 pips), they should be considered support and resistance levels.

On the chart:

Support and Resistance levels are the levels that serve as targets when buying or selling the pair. You can place Take Profit near these levels.

Red lines are channels or trend lines that display the current trend and show in which direction it is better to trade now.

The MACD indicator (14, 22, and 3) consists of a histogram and a signal line. When they cross, this is a signal to enter the market. It is recommended to use this indicator in combination with trend patterns (channels and trendlines).

Important announcements and economic reports that can be found on the economic calendar can seriously influence the trajectory of a currency pair. Therefore, at the time of their release, we recommend trading as carefully as possible or exiting the market in order to avoid sharp price fluctuations.

Beginners on Forex should remember that not every single trade has to be profitable. The development of a clear strategy and money management is the key to success in trading over a long period of time.