Analysis of Macroeconomic Reports:

Several macroeconomic reports are scheduled for Tuesday, with the most interesting ones being from the UK. In the UK, today will see the release of the unemployment rate for May, changes in the number of unemployed, and changes in average wages. In our view, these reports are not critical, as market movements are currently more affected by monetary policy and global events. Inflation influences monetary policy, while inflation is affected by the conflict in the Middle East. Therefore, we do not expect a strong market reaction to the British data. In the Eurozone, the ZEW economic sentiment indices will be released today, and in the U.S., the weekly ADP employment report will be published. These reports are also unlikely to stir significant emotions among traders.

Analysis of Fundamental Events:

Among the fundamental events on Tuesday, the speech by the President of the Bundesbank, Joachim Nagel, is notable. It is unlikely that Nagel will share important information ahead of the European Central Bank meeting, and in any case, the decision on rates will be made by the ECB's Monetary Committee, not the head of the German central bank. The market is almost certain that the ECB will leave rates unchanged, as the latest inflation report showed a slowdown. There is simply no need to rush to tighten monetary policy.

The geopolitical backdrop is once again shifting in an undesirable direction. Another ceasefire has been broken, and the U.S. and Iran have resumed hostilities. Negotiations are not taking place at this time. Donald Trump is preparing for new strikes against Iran, while Tehran is ready to respond at any moment by blocking the Bab-el-Mandeb Strait. Yesterday, the Yemeni Houthis announced a blockade of Saudi Arabia, likely intending to block the Red Sea. The situation is only escalating over time, provoking a new rise in oil prices.

General Conclusions:

During the second trading day of the week, both currency pairs may again move sluggishly, as no significant events are expected today. The euro can be traded from the area of 1.1363-1.1377, while the British pound can be traded from the area of 1.3456-1.3476. The euro cannot show significant growth and is inclined towards a new decline; the British pound has been in an upward trend for three weeks but may continue to correct 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.