Analysis of Macroeconomic Reports:

Very few macroeconomic events are scheduled for Wednesday. However, the UK inflation report holds significant importance for the market, or rather, used to. As we can see, traders continue ignoring macroeconomic and fundamental data, selling the dollar at every opportunity. According to expert estimates, the Consumer Price Index in the UK may accelerate to 3.3% in April, which is undoubtedly a bullish factor for the British pound, as the Bank of England may take an extended pause in its monetary easing if inflation rises like this. That said, the pound has been rallying strongly both Monday and Wednesday, even without this bullish support.

Analysis of Fundamental Events:

Among Wednesday's fundamental developments, we can note speeches from Federal Reserve representative Thomas Barkin and European Central Bank representative Philip Lane. However, how much impact will these speeches have, considering that the central banks' current policy stance is already crystal clear, and the market continues to trade on just one factor?

We believe that the only factor the market still cares about is the ongoing trade war. Though slowly de-escalating, it hasn't ended. Donald Trump continues to announce upcoming trade deals, but this news provides little real support for the dollar. A renewed dollar decline could occur if Trump starts imposing new tariffs, raises existing ones, or fails to finalize agreements with most countries. In fact, the dollar could continue falling even without new tariff measures, simply because market sentiment toward the U.S. president and his policies remains extremely negative.

Conclusions:

On the third trading day of the new week, both currency pairs may move in either direction. The macroeconomic backdrop remains weak, and there's no way to predict when Trump will make another impactful statement. We believe today's market behavior will likely remain close to flat. However, this week has shown the market's willingness to buy both pairs even without solid reasons or justification. Further growth is entirely possible.

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.