FX.co ★ What to Pay Attention to on November 7? Analysis of Fundamental Events for Beginners

Analysis of Macroeconomic Reports:

Very few macroeconomic reports are scheduled for Friday. In the European Union, there are no significant releases, while in the United States, only the University of Michigan consumer sentiment index is on the agenda. Recall that the first week of each month is typically when labor market data from the U.S. is published, including unemployment, job vacancies, and wages. However, for the second consecutive month, this data has not been released due to the ongoing "shutdown," which has now set a record for its duration. Thus, it remains extremely difficult to assess the current state of the U.S. labor market.

Fundamental Events Overview:

There are several fundamental events scheduled for Friday, but none are important. There will be further speeches from representatives of the Federal Reserve and the European Central Bank, but the central bank meetings took place just last week, so the market has already received all relevant information. It is unlikely that Elderson, Jefferson, or Miran will provide traders with anything fundamentally new, given that no new macroeconomic data (other than the ISM indices in the U.S.) have been published over the last week, and the ADP report is not taken seriously when assessing the state of the U.S. labor market. Everyone is awaiting the Non-Farm Payrolls report, which accounts for many more sectors than ADP.

General Conclusions:

During the last trading day of the week, both currency pairs may continue moving to the north, as a sufficient number of buy signals have been generated over the last two days. The euro has surpassed the 1.1527 level, so long positions remain relevant today, with a target of 1.1571-1.1584. The pound sterling has breached the 1.3102-1.3107 area, allowing long positions to be maintained until a sell signal is generated, with a target of 1.3203.

Key Principles of My Trading System:

1. The strength of the signal is considered based on the time taken to form the signal (bounce or breach of a level). The less time taken, the stronger the signal.
2. If two or more trades have been opened around a certain level based on false signals, all subsequent signals from that level should be ignored.
3. In a flat market, any pair can create numerous false signals or may not form them at all. In any case, it's best to stop trading at the first signs of a flat.
4. Trading deals are opened during the period between the start of the European session and the middle of the American session, after which all deals should be closed manually.
5. On the hourly timeframe, it is preferable to trade based on signals from the MACD indicator only when there is good volatility and a trend that is confirmed by a trend line or trend channel.
6. If two levels are too close to each other (between 5 and 20 pips), they should be treated as an area of support or resistance.
7. After a 15-20-pip move in the right direction, a Stop Loss should be set to breakeven.

What the Charts Show:

• Support and resistance price levels are targets for opening buy or sell positions. Take Profit levels can be placed around them.
• Red lines indicate trend channels or trend lines, reflecting the current trend and indicating the preferred trading direction.
• The MACD indicator (14,22,3) — histogram and signal line — is a supplementary indicator that can also be used as a source of signals.

Important announcements and reports (always available in the news calendar) can significantly impact the movement of the currency pair. Therefore, during their release, it is recommended to trade with maximum caution or to exit the market to avoid sharp reversals against the preceding movement.

Beginners trading on the Forex market should remember that not every trade can be profitable. Developing a clear strategy and money management is key to long-term success in trading.