Trade review of Wednesday:

1H chart of the EUR/USD pair

The EUR/USD currency pair again traded with minimal volatility on Wednesday, showing a slight upward bias and clearly standing in wait-and-see mode ahead of the week's main events. The important events begin today. The European Central Bank holds its meeting in the eurozone, and a 25 bp rate hike is expected. This is already the second monetary tightening in 2026 in response to the energy shock, the Middle East war, and accelerating inflation. Thus, the ECB remains (and after today likely will remain through September) the only major central bank tightening policy this year. The euro has not yet benefited much from this, but its prospects remain bullish. In our view, the Federal Reserve will probably hold its key rate next week, and Fed policy is currently the most significant factor for FX traders. Yesterday there were no material releases in either the US or the eurozone.

5M chart of the EUR/USD pair

On the 5-minute TF on Wednesday, two trading signals formed. During the US session, price bounced twice from the 1.1655 area, giving novice traders the chance to open early trades for the week. Volatility remained low, so intraday profits were limited to roughly 15 pips.

How to trade on Thursday:

On the hourly timeframe, EUR/USD can resume its upward trend. Considering recent months' events, the euro should continue steady gains even without local support. The US dollar currently has no growth drivers apart from the market's near-religious faith in a Fed rate hike — and that faith is visibly eroding.

On Thursday, novice traders may remain with short positions, targeting 1.1584–1.1594 if price rebounds from 1.1655–1.1665. Long positions can be opened targeting 1.1745–1.1754 if the pair closes above 1.1655–1.1665.

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. Today, the eurozone will publish the ECB decision, and Christine Lagarde will speak. No other major events are scheduled for the day.

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 provide 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.