Review of macroeconomic releases:

A fairly large number of macroeconomic releases are scheduled for Wednesday, but they are unlikely to shift market sentiment meaningfully — which continues to buy the dollar for any reason. Germany, the UK, the euro area and the US will publish first estimates of September business-activity indices for services and manufacturing. European and UK PMIs could provoke modest price reactions if actual prints diverge from forecasts; the greater the surprise, the stronger the likely market move. US PMIs are less likely to draw traders' attention this week.

Review of fundamental events:

Among Wednesday's fundamental items are speeches by Federal Reserve governor Michael Barr and European Central Bank chief economist Philip Lane. However, the Fed already met last week, delivered a unanimous rate hike, and the dot-plot implies most FOMC members expect at least one more hike before year-end — so the Fed's stance is clear. The ECB likewise signaled it is ready to continue tightening. That said, such information currently matters little because the market is buying the dollar on any pretext.

The geopolitical backdrop remains poor. The US and Iran are not negotiating; the Strait of Hormuz remains at least partially closed; Iran-backed Houthi forces continue to blockade Saudi Arabia and attack its facilities. President Trump is expected to make a significant decision on Iran soon, but no one knows what it will be. We continue to see little chance of a near-term diplomatic settlement between Iran and the US.

General conclusions:

On the third trading day of the week, currency pairs will likely try to correct again. The euro can be traded today from the 1.1461–1.1474 area, and the pound from the 1.3319–1.3331 area. Volatility may be muted today since no major events are scheduled.

Key Rules of the Trading System:

1. The strength of a signal is determined by the time it takes to form the signal (rebound or breakout). The less time taken, the stronger the signal.
2. If two or more trades were opened at a certain level based on false signals, all subsequent signals from that level should be ignored.
3. In a range (flat), any pair can generate many false signals or may not produce any at all. Technical levels may be disregarded.
4. On the hourly timeframe, trading signals from the MACD indicator should be acted upon only when volatility is high, and a trend line or trend channel confirms the trend.
5. If two levels are too close together (within 5-20 pips), treat them as a support or resistance area.
6. After moving 15 pips in the right direction, a stop-loss should be set to break even.

What to Look for on the Charts:

Price levels (areas) of support and resistance serve as targets for opening buy or sell trades or as sources of signals.

Red lines indicate channels or trend lines that show the current trend and the preferred trading direction.

The MACD indicator (14,22,3) — the histogram and signal line — is an auxiliary indicator that can also provide signals.

Important speeches and reports (listed in the news calendar) can significantly influence currency pair movements. Therefore, during their release, traders should approach trading with utmost caution, or exit the market to avoid sudden reversals against the preceding move.

Beginner forex traders should remember that not every trade can be profitable. Developing a clear strategy and practicing money management are key to long-term success in trading.