What to Pay Attention to on December 11? Analysis of Fundamental Events for Beginners

[Ben Graham]

Analysis of Macroeconomic Reports:

Very few macroeconomic reports are scheduled for Thursday. Essentially, the only report to note is the weekly jobless claims in the US, which is straightforwardly a secondary report. Recall that this week saw the release of the ADP employment report and the JOLTS open vacancies report. These are much more significant reports, but the market reacted weakly to them, as it continues to await important reports such as Non-Farm Payrolls, unemployment rates, and consumer price indexes, which will be published next week.

Analysis of Fundamental Events:

No fundamental events are scheduled for Thursday. However, traders will not lack information during the penultimate trading day of the week. Last night, the results of the last FOMC meeting of the year were announced. The key rate was lowered by 0.25% for the third consecutive time, and the committee's expectations did not become more dovish (according to the dot plot). Jerome Powell announced a pause in monetary easing until the inflation indicator shows a sustainable trajectory toward the target level of 2%. Thus, the outcomes of the FOMC meeting could somewhat be viewed as favorable for the dollar. However, the dollar has risen for too long and too often in recent months without a clear reason. It appears that its reserves of luck have been exhausted.

General Conclusions:

During the third trading day of the week, both currency pairs are likely to gravitate towards growth, as upward trends continue in both cases. The euro is targeting 1.1745, while the British pound is aiming for 1.3413. Volatility on Thursday may decrease, as there will be no significant events.

Key Rules of the Trading System:

1. The strength of a signal is determined by the time it takes to form the signal (bounce or breakout). The less time it takes, the stronger the signal.
2. If two or more trades were opened near a certain level based on false signals, all subsequent signals from that level should be ignored.
3. In a flat, any pair can form a multitude of false signals or none at all. At the first signs of a flat, it is better to stop trading.
4. Trades are opened during the time between the start of the European session and mid-American session, after which all trades should be closed manually.
5. On the hourly timeframe, using signals from the MACD indicator, it is preferable to trade only when good volatility exists, and a trend is confirmed by a trend line or channel.
6. If two levels are too close to each other (5 to 20 pips), they should be viewed as an area of support or resistance.
7. After moving 15-20 pips in the right direction, a Stop Loss should be set to breakeven.

Chart Explanations:

• Support and Resistance Levels: Levels that serve as targets for opening buys or sells. Take Profit levels can be placed near them.
• Red Lines: Channels or trend lines that reflect the current trend and indicate the preferred direction to trade.
• MACD Indicator (14, 22, 3): A histogram and signal line, a supplementary indicator that can also be used as a source of signals.

Important Note: Significant speeches and reports (always included in the news calendar) can greatly influence the movement of the currency pair. Therefore, during their release, it is advisable to trade cautiously or exit the market to avoid sharp reversals against the preceding movement.

Remember: For beginners trading in the Forex market, it is crucial to understand that not every trade can be profitable. Developing a clear strategy and implementing sound money management are keys to successful long-term trading.

The material has been provided by InstaForex Company - www.instaforex.com