Analyzing Wednesday's trades:

EUR/USD on 1H chart

EUR/USD experienced a significant downturn on Wednesday. In our opinion, what should have happened last week finally occurred. Recall that important US reports on Nonfarm Payrolls, unemployment, business activity, and the labor market turned out stronger than forecasted, and yet the euro rose instead of the dollar. Yesterday, however, the latest US inflation report was released, which showed that total CPI consumer inflation accelerated to +3.5% against forecasts of 3.4%. At this point, the market simply couldn't hold out any longer. In recent months, it has refused to buy the dollar and sell the euro, hoping that the Federal Reserve would start lowering rates at least by June. Yesterday, these hopes were shattered, and the market finally realized that the Fed would only begin to lower rates when it is confident that inflation is quickly approaching the target level, not in some arbitrarily chosen month. The downtrend persists, and the dollar should rise further.

EUR/USD on 5M chart

On the 5-minute timeframe, the first signal was a buy signal around the level of 1.0856. It should have been closed before the inflation report was released, as volatility was expected to increase. Then the price literally dropped by 70 pips in just 5 minutes, forming two sell signals. It was probably difficult to enter short positions during the steep decline, but shorts could have been opened even below the level of 1.0785. These shorts brought a profit of about 50 pips.

Trading tips on Thursday:

On the hourly chart, the downtrend persists. We believe that the euro should continue to fall regardless, as it is still too high, and the global trend is downward. Both this week's and last week's macro data provide full support for the US dollar.

Today, the pair will likely go through some correction. Volatility may increase, but it is unlikely to last long. Most likely, we will see a surge in market activity at the beginning of the U.S. session and that's it.

The key levels on the 5M chart are 1.0568, 1.0611-1.0618, 1.0668, 1.0725, 1.0785-1.0797, 1.0838-1.0856, 1.0888-1.0896, 1.0940, 1.0971-1.0981, 1.1011, 1.1043, 1.1091. Today, attention now turns to the European Central Bank meeting, and ECB President Christine Lagarde's news conference follows later. In the US, only secondary reports are expected.

Basic trading rules:

1) Signal strength is determined by the time taken for its formation (either a bounce or level breach). A shorter formation time indicates a stronger signal.

2) If two or more trades around a certain level are initiated based on false signals, subsequent signals from that level should be disregarded.

3) In a flat market, any currency pair can produce multiple false signals or none at all. In any case, the flat trend is not the best condition for trading.

4) Trading activities are confined between the onset of the European session and mid-way through the U.S. session, after which all open trades should be manually closed.

5) On the 30-minute timeframe, trades based on MACD signals are only advisable amidst substantial volatility and an established trend, confirmed either by a trendline or trend channel.

6) If two levels lie closely together (ranging from 5 to 15 pips apart), they should be considered as a support or resistance zone.

How to read charts:

Support and Resistance price levels can serve as targets when buying or selling. You can place Take Profit levels near them.

Red lines represent channels or trend lines, depicting the current market trend and indicating the preferable trading direction.

The MACD(14,22,3) indicator, encompassing both the histogram and signal line, acts as an auxiliary tool and can also be used as a signal source.

Significant speeches and reports (always noted in the news calendar) can profoundly influence the price dynamics. Hence, trading during their release calls for heightened caution. It may be reasonable to exit the market to prevent abrupt price reversals against the prevailing trend.

Beginning traders should always remember that not every trade will yield profit. Establishing a clear strategy coupled with sound money management is the cornerstone of sustained trading success.