Analysis of Thursday's Trades:

1H Chart of the EUR/USD Pair

The EUR/USD currency pair showed no notable movement on Friday, and volatility remained minimal. Throughout the day, the only interesting events we can note are the consumer confidence index in Germany and the unemployment claims report in the U.S. Clearly, neither report provoked any market reaction. Thus, for the entire week, the pair has been correcting within the upward trend. We would not even pay attention to the fact that the price broke the trendline. Given the nature of the current movement, we believe that the upward trend remains intact. Its prospects will be determined today following Federal Reserve Chair Kevin Warsh's speech and the publication of the annual revision of Non-Farm Payrolls. There is little hope for a dollar rise, but it cannot be completely dismissed. The developments in the second half of the day could be anything.

5M Chart of the EUR/USD Pair

On the 5-minute timeframe, two formal sell signals were generated on Thursday. The price bounced twice from the area of 1.1655-1.1665 but, due to weak volatility, was unable to show a decline of even 15 pips. In principle, we have been repeating the same thing since last week: if there are no movements in the market, then no signals will yield profit.

How to Trade on Friday:

On the hourly timeframe, the EUR/USD pair continues to form an upward trend. Considering all the events of recent months, we believe that the euro should continue its confident rise even without local support. Currently, there are no growth factors for the U.S. dollar, so we continue to expect upside movement.

On Friday, novice traders may consider short positions with targets at 1.1584-1.1594 if the price bounces from the 1.1655-1.1665 area. Long positions can be opened with targets at 1.1745-1.1754 if the price establishes itself above the 1.1655-1.1665 area.

On the 5-minute timeframe, trading levels to consider are 1.1366-1.1377, 1.1461-1.1474, 1.1527-1.1531, 1.1584-1.1594, 1.1655-1.1665, 1.1745-1.1754, and 1.1830-1.1837. On Friday, Germany will publish its unemployment rate, and in the U.S., Warsh will speak, and the annual Non-Farm Payroll report will be released, which will determine the fate of the dollar in the near future.

Main Rules of the Trading System:

1. The strength of the signal is determined by the time it takes to form the signal (bounce or level breakthrough). The less time required, the stronger the signal.
2. If two or more trades are opened around a level based on false signals, all subsequent signals from that level should be ignored.
3. In a flat, any pair can generate a multitude of false signals or none at all. Technical levels may be disregarded.
4. When trading based on MACD signals on the hourly timeframe, it is advisable to do so only when volatility is high and a trend line or channel supports the trend.
5. If two levels are too close to each other (from 5 to 20 pips), they should be regarded as a support or resistance area.
6. After a 15-pip move in the correct direction, a stop-loss should be set to break even.

What the Charts Show:

Support and resistance price levels (areas) are the targets when opening buy or sell orders or sources of signals.

Red lines denote channels or trend lines that reflect the current trend and indicate in which direction trading is currently favored.

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

Important speeches and reports (as listed in the news calendar) can significantly influence the movement of the currency pair. Therefore, during their release, trading should be approached with utmost caution, or one should exit the market to avoid sharp price reversals against the preceding movement.

Beginners in Forex trading should remember that not every trade can be profitable. Developing a clear strategy and proper money management are essential for long-term trading success.