Analysis of Macroeconomic Reports:

Several macroeconomic events are scheduled for Tuesday. The ZEW Economic Sentiment Index will be released in Germany and the Eurozone, but this is a secondary indicator. It may trigger only a minimal market reaction and will not affect the overall picture, even on the hourly timeframe. More significant reports on unemployment, claimant count change, and wage growth will be published in the UK. It is important to note that wage growth directly influences overall inflation, which, in turn, impacts the monetary policy of the Bank of England. The unemployment rate is also a crucial metric, expected to rise to 4.5%.

Analysis of Fundamental Events:

A speech by Bank of England Governor Andrew Bailey is noteworthy among Tuesday's fundamental events. However, his last remarks occurred yesterday, and the market received no new insights regarding monetary policy. Moreover, the BoE meeting was held recently, so the market already clearly understands what to expect from the British regulator. We do not anticipate any significant statements from Bailey.

Several representatives of the Federal Reserve and the ECB are also scheduled to speak in the U.S. and the Eurozone, but no major announcements are expected from them either.

General Conclusions:

Market movements may be weak and erratic during the second trading day of the new week. Only the British pound might show some trading activity due to the morning economic reports. However, we do not expect the euro or the pound to extend their rally, as both currencies experienced a strong upward movement throughout the last week without sufficient macroeconomic and fundamental justification.

The upward correction could continue for several weeks, but the market may need to pull back slightly before resuming growth.

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.