Here are the details of the economic calendar for Sept 2:
The weekly data on unemployment applications in the United States was published yesterday, where the figures came out quite well. However, the market only paid attention to them locally.
Details of statistics:
The volume of initial applications for benefits fell from 345 thousand. up to 340 thous.
The volume of repeated applications for benefits fell from 2,908 thousand to 2,748 thousand.
* Applications for unemployment benefits reflect the number of currently unemployed citizens and those receiving unemployment benefits. This indicator is considered to be the state of the labor market, where the growth of the indicator negatively affects the level of consumption and economic growth. The reduction of applications for benefits has a positive effect on the state of the labor market.
Analysis of trading charts from September 2:
During the two weeks of the correction course of the EUR/USD pair, the quote returned to the area of the local high of the previous correction of 1.1880/1.1905. This led to a reduction in the volume of long positions and a slowdown in the upward movement.
Despite the fact that we consider selling positions on a daily basis, alternative scenarios should not be forgotten. So, the positions for sale should have become relevant if the price is kept below the level of 1.1800, but this did not happen. Instead, the inertial upward movement was preserved in the market. This possibility was described in the previous article. The benchmark for fixing profits from buy positions was the level of 1.1900, in the direction in which the quote was moving.
As for the GBP/USD pair, traders managed to break through its upper border during the three-day movement in the range of 1.3730/1.3800. As a result, a speculative growth in the volume of long positions was noticed.
The trading strategy on September 3 considered trading on the breakdown of one or another border of the 1.3730/1.3800 range set in the market. Due to this approach, there was a chance to enter the market at the most appropriate moment. Thus, traders could open buy positions and make money on the momentum coming from the side range.
Long positions or Long means buy positions.
September 3 economic calendar:
Today, the United States Department of Labor will publish its report, which is considered one of the most important economic events in the financial world.
The unemployment rate for July may decline from 5.4% to 5.2%.
Outside agriculture, 750 thousand new jobs can be created against 943 thousand in the previous reporting period.
According to the details of statistical expectations, experts predict a further recovery process, and this may lead to an increase in the US dollar if the forecast coincides. At the same time, the ADP employment rate report, which was released on Wednesday, showed that expectations for new jobs could be overestimated. This suggests that the report may come out worse than the forecast, and this will negatively affect the dollar positions.
It is worth noting that the weakening of the US dollar yesterday may signal that the market is considering the worst-case scenario in advance based on the report. In this case, the US dollar may not sharply weaken even with negative statistics.
The time of publication of the report is 12:30 Universal time.
Trading plan for EUR/USD on September 3:
The resistance area of 1.1880/1.1905 puts pressure on buyers, so it is impossible to exclude a natural rebound in the price, as it happened in early August. If the expectations for a rebound coincide, the US dollar may strengthen towards the level of 1.1800.
An alternative scenario of the market development will be relevant if the price is kept above the level of 1.1920.
Trading plan for GBP/USD on September 3:
The pound's overbought status due to the prolonged correction from August 23 leads again to the consideration of short positions in the market. This signal will become most relevant if the price is kept below the level of 1.3800.
A movement along an upward trajectory is currently limited by the resistance level of 1.3880.
* Overbought market – a situation that occurs after prices have risen too high and quickly, and are expected to fall soon. In our case, we are talking about the euro, which has risen quite strongly.
Short positions or Short means sell positions.
What is reflected in the trading charts?
A candlestick chart view is graphical rectangles of white and black light, with sticks on top and bottom. When analyzing each candle in detail, you will see its characteristics of a relative period: the opening price, closing price, and maximum and minimum prices.
Horizontal levels are price coordinates, relative to which a stop or a price reversal may occur. These levels are called support and resistance in the market.
Circles and rectangles are highlighted examples where the price of the story unfolded. This color selection indicates horizontal lines that may put pressure on the quote in the future.
The up/down arrows are the reference points of the possible price direction in the future.
Golden Rule: It is necessary to figure out what you are dealing with before starting to trade with real money. Learning to trade is so important for a novice trader because the market is constantly dynamic and it is important to understand what is happening.
