Analysis of Macroeconomic Reports:

Several macroeconomic reports are scheduled for Tuesday, but all of them are secondary. In the U.S., reports on building permits and housing starts will be released. We believe these reports may trigger only a minor market reaction, and only if the figures differ drastically from forecasts. In Germany, the EU, and the UK, no significant events are scheduled for today.

Analysis of Fundamental Events:

Among fundamental events on Tuesday, the only one worth noting is the speech by Federal Reserve Monetary Policy Committee member Michelle Bowman. Recall that Bowman holds an ultra-dovish stance and believes that monetary policy easing should begin immediately. It is worth mentioning that Donald Trump appointed Bowman to her position, so her views are not surprising. Nevertheless, the Fed is moving toward a key rate cut in any case, so another dovish comment is unlikely to surprise the market.

For traders, the trade war remains the top priority. We continue to believe that any trade agreements that maintain tariffs are still part of the same trade war, only "under a different label." Deals like those concluded with the European Union or Japan are, of course, beneficial for the U.S. Therefore, each new similar agreement could provoke growth in the U.S. dollar. However, globally and fundamentally, the market will keep in mind the new trade architecture and Trump's protectionist policy. Under such conditions, the dollar is unlikely to show convincing growth.

Conclusions:

On the second trading day of the week, both currency pairs may move in either direction. Today, there are virtually no fundamental or macroeconomic drivers influencing the market, and volatility has been low recently. As a result, any trading positions taken today should be based solely on technical levels.

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.