Analysis of Macroeconomic Reports:

There are a few macroeconomic reports scheduled for Tuesday. The economic event calendars for both the Eurozone and the United States are empty, while the UK will release reports that are certainly of interest but not significant enough to expect a strong market reaction. As we've mentioned before, the macroeconomic background currently attracts little attention from traders. A local reaction is possible, but the market continues to be driven by Donald Trump. In the UK, reports on the unemployment rate, changes in the number of unemployed, and changes in average earnings will be released today. The unemployment rate is expected to rise to 4.6%, which is negative for the British currency. But who is seriously expecting strong growth in the US dollar right now?

Analysis of Fundamental Events:

There is absolutely nothing noteworthy among fundamental events on Tuesday. The European Central Bank meeting has already occurred, and the Bank of England and Federal Reserve meetings will happen later. However, they carry no real intrigue—just like the ECB meeting. Both central banks are expected to leave key interest rates unchanged with a 99% probability.

We believe the market still only cares about the ongoing trade war, which continues escalating. The dollar's decline may persist if trade agreements with most countries are not signed before the grace period ends—just a month away. The dollar may continue to fall even without new tariffs from Trump, as market sentiment toward the US president and his policies remains extremely negative. And Trump continues to make "interesting" decisions not only in the international arena. Just a few days ago, the US Immigration Service began raids in major cities, sparking mass unrest and protests.

Conclusions:

On the second trading day of the week, both currency pairs are likely to be influenced by technical factors. Low volatility and sideways movement are expected as no macroeconomic data are scheduled for today.

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.