02.01.202508:05 Forex Analysis & Reviews: What to Pay Attention to on January 2? A Breakdown of Fundamental Events for Beginners

Analysis of Macroeconomic Reports:

There are few macroeconomic events scheduled for Thursday, and none of them are significant. The main items of interest for novice traders today are the Manufacturing PMIs for Germany, the UK, the US, and the EU for December. These reports will be published as second estimates, which are generally considered less important than the initial readings. Of course, if the actual values differ significantly from the forecasts or the first estimates, the market may react. However, the likelihood of such deviations is low. We believe that today both currency pairs will remain within their respective horizontal channels.

Analysis of Fundamental Events:

On Thursday, there are no significant fundamental events to report. However, the market does not currently require any new speeches or comments from central bank representatives regarding monetary policy. Recently, all three major central bank meetings took place, providing market participants with extensive information about the economies and upcoming actions from the central banks. In our opinion, these meetings delivered a clear message to traders: the US dollar is expected to continue strengthening.

At this moment, the market is experiencing a New Year's pause, so we anticipate that fundamental themes will re-emerge and begin to influence the market again next year.

General Conclusions:

On the fourth trading day of the week, traders will primarily need to rely on technical signals if they wish to engage in the market, which has been in a prolonged flat phase lasting at least two weeks. Today, volatility is expected to be very low, and the movement of both currency pairs is likely to remain sideways. Since the euro and the pound have reached the lower boundaries of their respective horizontal channels, a slight recovery in both currencies can be anticipated today.

Key Rules for the Trading System:

1. Signal strength is determined by the time it takes for a signal to form (bounce or breakout of a level). The shorter the time, the stronger the signal.
2. If two or more false signals are generated near a level, subsequent signals from that level should be ignored.
3. In a flat market, any pair may produce numerous false signals or none at all. In such cases, it's better to stop trading at the first signs of consolidation.
4. Trades should be opened during the European session through the middle of the American session. All trades should be manually closed thereafter.
5. On the hourly timeframe, trades based on MACD signals should only be executed during periods of strong volatility and trends confirmed by trendlines or trend channels.
6. If two levels are very close (5–20 pips apart), they should be treated as a support or resistance zone.
7. After a 15–20 pip movement in the correct direction, set a Stop Loss at breakeven.

What's on the Charts:

Support and Resistance Levels: Targets for opening buy or sell orders. These are ideal points for setting Take Profit levels.

Red Lines: Trendlines or channels reflecting the current trend direction and indicating the preferred trading direction.

MACD Indicator (14,22,3): A histogram and signal line serving as auxiliary indicators and sources of signals.

Key News Events and Reports: Always listed in the economic calendar, these can significantly impact currency pair movements. Exercise caution or exit the market during such events to avoid sharp price reversals.

Every trade cannot be profitable. The key to long-term success in Forex trading lies in developing a clear strategy and effective money management.