Macroeconomic Report Analysis:

No significant macroeconomic reports are scheduled for Monday. Both the euro and the pound are recovering after declines seen over the past one and a half to two weeks. We believe the macroeconomic and fundamental background remains unfavorable for the U.S. dollar. Therefore, we expect the bearish trend in both currency pairs to come to an end, with European currencies likely resuming their upward movement.

Fundamental Events Analysis:

Today's calendar is full of speeches rather than data. In the Eurozone, European Central Bank representatives Cipollone, Kazaks, Muller, Schnabel, and Chief Economist Philip Lane are scheduled to speak. In our view, markets currently have no questions for the ECB: the easing cycle is complete, and with inflation accelerating in the Eurozone, further rate cuts are unlikely.

As for the Federal Reserve, there are slightly more uncertainties, but they remain limited. The Fed has made it clear that all future rate decisions will depend on macroeconomic data. If additional easing becomes necessary (due to labor market weakness), it will be implemented. If not, the Fed is likely to pause again in light of rising U.S. inflation. Thus, meaningful new insights from ECB and Fed officials should only be expected once fresh labor market, unemployment, and inflation reports are released.

General Conclusions:

On the first trading day of the week, both currency pairs may move in either direction due to the absence of important macroeconomic data. The pound sterling has already ended its bearish phase, and the euro is likely to follow a similar path.

• For EUR/USD, the 1.1737–1.1745 area remains key for intraday trading.
• For GBP/USD, the 1.3413–1.3421 area has already been breached, making fresh long positions toward 1.3466–1.3475 relevant at the current stage.

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 Events and Reports: Found in the economic calendar, these can heavily influence price movements. Exercise caution or exit the market during their release to avoid sharp reversals.

Forex trading beginners should remember that not every trade will be profitable. Developing a clear strategy and practicing proper money management are essential for long-term trading success.