Analysis of Macroeconomic Reports:

There are very few macroeconomic reports scheduled for Wednesday, and none are particularly important. In Germany, the GfK consumer confidence index will be published; in the Eurozone, the second estimate of January inflation will be released; and in Germany, the third estimate of fourth-quarter GDP will be available. Theoretically, these events could provoke a market reaction, but only if actual values deviate significantly from forecasts, which is unlikely. There are no scheduled events in the U.S. today.

Analysis of Fundamental Events:

Among the fundamental events on Tuesday, a few speeches from representatives of the ECB and the Fed can be highlighted; however, both central banks currently maintain a clear and firm stance on monetary policy. The ECB is not concerned about the slowdown in inflation to 1.7% year-on-year, so a reduction in the key interest rate is not planned in the near future. Conversely, the Fed is worried about inflation at 2.4%, considering it is elevated, and thus does not plan to implement any new monetary easing soon. Therefore, new speeches from ECB and Fed representatives are unlikely to provide the market with any new or important information. Global attention is currently focused on Donald Trump (who would doubt it!). The world is waiting for clarification on the new tariffs and old agreements, which changed in the blink of an eye after the Supreme Court annulled all old tariffs, and Trump immediately imposed new, uniform tariffs for everyone.

General Conclusions:

During the third trading day of the week, very weak movements may be observed in the market, as Monday showed that traders are not at all shocked by the Supreme Court's ruling and the immediate reinstatement of all tariffs by Trump. The euro can be traded today in the range of 1.1830-1.1837, while the British pound can be traded in the range of 1.3529-1.3543. We still see no grounds for strong, sustained growth in the American currency, but both pairs continue to lean towards decline.

Main Rules of the Trading System:

1. The strength of the signal is determined by the time it takes to form (rebound or breaking through the level). The shorter the time, the stronger the signal.
2. If two or more trades were opened around a particular level based on false signals, all subsequent signals from that level should be ignored.
3. In a flat market, any pair can generate numerous false signals or no signals at all. In any case, it is best to stop trading at the first signs of a flat.
4. Trades are opened during the time period between the start of the European session and until the middle of the American session, after which all trades should be manually closed.
5. On the hourly timeframe, signals from the MACD indicator should ideally be traded only when there is good volatility and a trend confirmed by a trend line or channel.
6. If two levels are too close to each other (ranging from 5 to 20 pips), they should be considered as a support or resistance area.
7. After moving 15-20 pips in the correct direction, it is advisable to set the Stop Loss to break-even.

What's on the Charts:

• Support and resistance levels are targets for opening buy or sell trades. Take Profit levels can be placed around them.
• Red lines indicate channels or trend lines that reflect the current trend and indicate the preferred direction for trading now.
• The MACD indicator (14,22,3) – the histogram and signal line – serves as a supplementary indicator that can also be used as a source of signals.
• Important speeches and reports (always found in the news calendar) can significantly influence the movement of the currency pair. Therefore, during their release, trading should be conducted with maximum caution, or it is advised to exit the market to avoid a sharp price reversal against the preceding movement.
• Beginners trading in the Forex market should remember that not every trade can be profitable. Developing a clear strategy and practicing sound money management are the keys to long-term trading success.