Analysis of Macroeconomic Reports:

There are no macroeconomic reports scheduled for Monday. Thus, traders will have nothing to react to today. Movements will once again be purely technical for both currency pairs. Only geopolitics can influence market movements.

Analysis of Fundamental Events:

Among the fundamental events on Monday, we can note the speeches by Federal Reserve representatives Michelle Bowman and Christopher Waller, European Central Bank's Isabel Schnabel, and the Bank of England's Huw Pill. The ECB's monetary policy stance is currently ambiguous and largely depends on inflation. At the last meeting, the central bank was inclined toward further interest rate hikes, but inflation in the Eurozone has begun to slow, and its future dynamics will depend on the fate of the Strait of Hormuz and the conflict in the Middle East. Forecasting anything on this topic is impossible. As for the BoE and the Fed, their monetary policy will also depend on inflation. Given that the fate of the Strait of Hormuz remains uncertain and oil prices are rising again, making predictions is extremely difficult. We need to look at the inflation data.

The geopolitical backdrop remains consistently "conditionally positive." Iran and the U.S. have signed an agreement remotely; however, too many important issues remain unresolved. In particular, the "nuclear issue," the war between Lebanon and Israel, and the status of the Strait of Hormuz. Theoretically, the market may fear a resumption of full-scale war, but this is clearly not enough for the dollar to begin rising actively again. After all, Tehran and Washington are still on the tracks leading to peace, and negotiations continue. However, events from the past week demonstrate the fragility of any ceasefires between the U.S. and Iran. Negotiations and deals can fall through at any moment.

General Conclusions:

During the first trading day of the week, both currency pairs may trade very sluggishly, as there are no significant events today. Both the euro and the pound will be traded on "bare" technicals. The euro can be traded from the 1.1420-1.1432 area, while the British pound can be traded from the 1.3380-1.3386 area. We would not expect strong movements or high volatility today.

Basic Rules of the Trading System:

1. The strength of a signal is evaluated based on the time it takes to form (bounce or breakout). The less time required, the stronger the signal.
2. If two or more trades were opened at a particular level based on false signals, all subsequent signals from that level should be ignored.
3. In a flat market, any pair may generate many false signals or none at all. Technical levels may be overlooked.
4. On the hourly timeframe, trading signals from the MACD indicator should be executed only when volatility is good, and a trend is confirmed by a trend line or channel.
5. If two levels are too close together (5 to 20 pips), they should be considered a support or resistance area.
6. After moving 15 pips in the correct direction, a Stop Loss should be set at breakeven.

What's on the Charts:

Price levels (areas) of support and resistance are targets when opening long or short positions or sources of signals.

Red lines indicate channels or trend lines that display the current trend and indicate the preferred direction for trading.

The MACD indicator (14,22,3) – histogram and signal line – is a supplementary indicator that can also be used as a source of signals.

Important speeches and reports (contained in the news calendar) can significantly impact the movement of the currency pair. Therefore, during their release, trading should be conducted with maximum caution, or one should exit the market to avoid sharp reversals against preceding movements.

Beginners trading in the forex market 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.