Analysis of Macroeconomic Reports:

There are very few macroeconomic events scheduled for Wednesday. The main highlight of the day is the U.S. inflation report, which is significant due to its direct impact on the Federal Reserve's monetary policy.

It is important to note that the Fed has no immediate plans to cut interest rates, as Jerome Powell reaffirmed yesterday. If inflation continues to rise in the medium term—following three consecutive months of increases in the U.S.—this will further decrease the likelihood of at least two rate cuts in 2025, a scenario that the market had initially anticipated. Therefore, a higher inflation rate in the U.S. is more favorable for the dollar.

Analysis of Fundamental Events:

The main event on Wednesday is Jerome Powell's second testimony before the U.S. Congress. It's important to note that all three major central banks have recently held their policy meetings, so it is unlikely that their positions on monetary policy have changed significantly.

Powell spoke in Congress yesterday, responding to questions from senators but did not provide any new or impactful information. Although today's questions from lawmakers may differ, Powell is expected to maintain a consistent stance with the Fed's current messaging. As a result, we do not anticipate any significant market-moving statements from Powell today.

General Conclusions:

On the third trading day of the week, market movements can be highly unpredictable. Volatility is elevated, and the inflation report is the most significant event of the day, which may further increase price fluctuations. If U.S. inflation is higher than expected, the dollar could strengthen significantly in the afternoon. Conversely, if inflation slows down, the dollar may continue to decline.

Key Rules for the Trading System:

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 15–20 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 speeches and reports, which are consistently featured in the news calendar, can significantly influence the movement of a currency pair. Therefore, during their release, it is advisable to trade with caution or consider exiting the market to avoid potential sharp price reversals against the prior trend.

Beginners in the Forex market should understand that not every transaction will be profitable. Developing a clear trading strategy and practicing effective money management are crucial for achieving long-term success in trading.