Analysis of Macroeconomic Reports:

Quite a few macroeconomic events are scheduled for Thursday, but none are significant. In the Eurozone, industrial production and retail sales reports will be published. In the United States, data on jobless claims will be released. We believe these reports are unlikely to have any meaningful impact today. The market is still influenced by Donald Trump's victory in the U.S. presidential elections and will closely follow the results of the Bank of England and Federal Reserve meetings today.

Analysis of Fundamental Events:

The key fundamental events on Thursday are the Bank of England and Federal Reserve meetings. However, the meetings themselves are unlikely to surprise traders. Both central banks are expected to lower their key interest rates by 0.25%, a move the market has already anticipated. The open question is what Jerome Powell and Andrew Bailey will communicate to the market. Recall that the BoE has only reduced its rate once so far, so Governor Bailey may adopt a dovish tone, which could further pressure the British pound. Similarly, Powell may address the recent weak Nonfarm Payrolls report and take a dovish stance, which would be a reason for the U.S. dollar's weakening.

General Conclusions:

On the fourth trading day of the week, both currency pairs may continue experiencing sharp fluctuations in either direction. Yesterday's rise in the U.S. dollar should not be misleading, as it does not provide a solid basis for any conclusions. For instance, the dollar could just as easily decline if the Fed maintains a dovish tone. Therefore, it's crucial to exercise caution when opening any trading positions.

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 15-20 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.