Analysis of Tuesday's Trades

1H Chart of EUR/USD

On Tuesday, the EUR/USD currency pair continued its upward trend without any corrections or pullbacks. For a few days, the euro traded between the levels of 1.0804 and 1.0888 before resuming its ascent. There were no significant macroeconomic factors influencing this movement, similar to previous trends. The only notable report released that day was the JOLTs job openings data from the U.S., which was slightly better than expected. However, this did not affect the dollar's performance, as Donald Trump announced new tariffs on Canada overnight. Specifically, he expanded existing tariffs in response to Canada's refusal to easily accept becoming the 51st state of the U.S. Import tariffs on steel and aluminum were doubled, and the market clearly reacted to Trump's decisions.

5M Chart of EUR/USD

On the five-minute timeframe on Tuesday, several trade signals were generated. The first sell signal around the 1.0845-1.0851 area turned out to be false. However, the subsequent buy signal from the same range allowed traders to secure a good profit. Three more buy signals followed, enabling novice traders to maintain long positions easily. Eventually, the pair reached the 1.0940-1.0952 zone and bounced off it, which provided an optimal point for closing long positions and even opening short positions.

Trading Strategy for Wednesday:

In the hourly timeframe, EUR/USD remains on a medium-term downward trend, though the chances of its continuation are decreasing. The fundamental and macroeconomic background continues to favor the U.S. dollar much more than the euro, so we still expect a decline. However, Donald Trump continues to drag the dollar down with his daily decisions and statements. Currently, fundamentals and macroeconomics are overshadowed by politics and geopolitics.

On Wednesday, the euro could move in any direction, as macroeconomic and fundamental factors no longer consistently impact the pair. The U.S. inflation report is important, but Trump's actions are more significant.

For the five-minute timeframe, consider trading around the levels of 1.0433-1.0451, 1.0526, 1.0596, 1.0678, 1.0726-1.0733, 1.0797-1.0804, 1.0845-1.0851, 1.0888-1.0896, 1.0940-1.0952, 1.1011, 1.1048. The U.S. inflation report for February is set for release, and we would have called it a major event just a week and a half ago. Now, it barely matters, as the market is solely reacting to Trump's decisions and statements.

Core Trading System Rules:

1. Signal Strength: The shorter the time it takes for a signal to form (a rebound or breakout), the stronger the signal.
2. False Signals: If two or more trades near a level result in false signals, subsequent signals from that level should be ignored.
3. Flat Markets: In flat conditions, pairs may generate many false signals or none at all. It's better to stop trading at the first signs of a flat market.
4. Trading Hours: Open trades between the start of the European session and the middle of the US session, then manually close all trades.
5. MACD Signals: On the hourly timeframe, trade MACD signals only during periods of good volatility and a clear trend confirmed by trendlines or trend channels.
6. Close Levels: If two levels are too close (5–20 pips apart), treat them as a support or resistance zone.
7. Stop Loss: Set a Stop Loss to breakeven after the price moves 15 pips in the desired direction.

Key Chart Elements:

Support and Resistance Levels: These are target levels for opening or closing positions and can also serve as points for placing Take Profit orders.

Red Lines: Channels or trendlines indicating the current trend and the preferred direction for trading.

MACD Indicator (14,22,3): A histogram and signal line used as a supplementary source of trading signals.

Important Events and Reports: Found in the economic calendar, these can heavily influence price movements. Exercise caution or exit the market during their release to avoid sharp reversals.

Forex trading beginners should remember that not every trade will be profitable. Developing a clear strategy and practicing proper money management are essential for long-term trading success.