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07.10.2026 04:45 AM
What to Watch on October 7? Analysis of Fundamental Events for Beginners

Analysis of macroeconomic reports:

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Very few macroeconomic releases are scheduled for Wednesday, and none of them are important. Germany will publish its August industrial-production report today, but who on the market is really interested in that figure right now? No other significant releases are scheduled today. Thus everything points to sideways, low-volatility trading — but recall that over the past month the market has not needed reasons to buy the dollar. Therefore, the US currency can strengthen at any moment.

Analysis of fundamental events:

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Among Wednesday's fundamental events are speeches by European Central Bank officials Vujcic and Cipollone. ECB representatives may harden their rhetoric on key rates because September inflation accelerated more than expected. However, a hawkish turn and prospects of a third ECB hike this year are unlikely to help the euro, since the market has already ignored ECB tightening twice. The euro cannot rally even when ECB hawkishness rises and Federal Reserve hawkishness softens.

The geopolitical backdrop still leaves much to be desired, though it is not noticeably worsening. The US and Iran are not holding official talks at the moment, while Donald Trump continues to insist a deal could be signed after the US Congressional elections. Trump also repeatedly claims the conflict between Ukraine and Russia may end very soon — a refrain he has made for nearly two years — so the market does not give such statements much credence. Over the weekend, it became known that Yemen launched a military operation against the Houthis, and the Houthis continue to strike Saudi oil and gas facilities and tankers. Thus tensions in the Middle East are heating up, contrary to the US president's statements.

General conclusions:

During the third trading day of the week, currency pairs can calmly continue to decline, since the move now does not depend on fundamentals, geopolitics, or macroeconomics. The euro can be traded today from the 1.1198–1.1218 and 1.1267–1.1275 areas, and the pound sterling from the 1.3259–1.3267 area. Volatility today may be low.

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.

Paolo Greco,
Analytical expert of InstaForex
© 2007-2026
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