Analysis of Wednesday's Trades:

1H Chart of EUR/USD Pair

The EUR/USD currency pair continued its downward movement on Wednesday. In fact, the pair has been falling almost every day without requiring significant fundamental or macroeconomic reasons. Yesterday, only one report was published, which supported the euro more than the dollar. U.S. inflation in October accelerated to 2.6% year-over-year, fully matching expert forecasts. However, since there were no deviations from forecasts for either core or headline inflation, the market had no valid reason to continue buying the dollar. Nevertheless, the dollar continued to grow steadily, once again proving that the market is simply balancing the dollar exchange rate, aligning it to a fair level after two years of illogical decline. Thus, the pair's decline may continue today and tomorrow. The price is already approaching 1.05, which seemed unimaginable just a month ago. We believe it can easily reach our target range of 1.00–1.02.

5M Chart of EUR/USD Pair

On Wednesday, several signals were generated in the 5-minute time frame, and some levels were updated. The price rebounded from the 1.0596 level, broke below it, and twice rebounded from 1.0557. As we can see, none of the signals resulted in losses. The current volatility is excellent, another sign of a trending market. Recall the low volatility from the first half of 2024, when the pair moved only 40 pips per day and was artificially pushed higher.

How to Trade on Thursday:

In the hourly time frame, EUR/USD may attempt a correction, but the market shows no interest in buying euros or taking profits in short positions. We believe any correction (if it happens soon) is unlikely to be strong and would require news supporting the euro. Even favorable news doesn't always help the euro, as the market is now focused on buying dollars.

On Thursday, we believe the decline may continue if the price breaks below the 1.0596 level. We do not recommend buying the pair, even if an upward correction begins.

On the 5-minute TF, we should consider the levels of 1.0483, 1.0526, 1.0557, 1.0596, 1.0678, 1.0726-1.0733, 1.0797-1.0804, 1.0845-1.0851, 1.0888-1.0896, 1.0940-1.0951. In the Eurozone, notable releases include GDP and industrial production data, while in the U.S., Jerome Powell's speech and a few medium-impact reports are scheduled for Thursday.

Basic Trading System Rules:

1. The strength of a signal is determined by the time it takes to form (whether a bounce or breakthrough of a level). The quicker the formation, the stronger the signal.
2. If two or more trades have been made near a level due to false signals, any further signals from that level should be ignored.
3. In a flat market, a pair can generate many false signals or none at all. In any case, it's best to stop trading at the first signs of a flat market.
4. Trading occurs between the start of the European and middle of the US sessions, after which all trades should be manually closed.
5. On the hourly time frame, it's recommended to trade MACD indicator signals only when there is good volatility and a trendline or trend channel confirms a trend.
6. If two levels are too close together (5 to 20 pips apart), they should be treated as support or resistance areas.
7. After the price moves 15 pips in the intended direction, set the Stop Loss to breakeven.

What's on the Charts:

Support and Resistance Levels: Levels that serve as targets for opening buys or sells. Take Profit levels can be placed around these areas.

Red Lines: Channels or trend lines that indicate the current trend and the preferred trading direction.

MACD Indicator (14,22,3): Histogram and signal line—an auxiliary indicator that can also be used as a source of signals.

Major speeches and reports (always found in the news calendar) can significantly impact currency pair movements. Therefore, it's advised to trade cautiously or exit the market during their release to avoid sharp price reversals against prior movements.

Beginners trading on the forex market should remember that not every trade will be profitable. A clear strategy and money management are the keys to success in long-term trading.