Analysis of Macroeconomic Reports:

Very few macroeconomic events are scheduled for Monday, and none are significant. Over the past two weeks, the market has largely ignored fundamental and macroeconomic data. Last week, important reports on unemployment and inflation in the UK were overlooked, yet the pound still gained 100 pips the following day despite an empty economic calendar. On Monday, the Eurozone will release its second inflation estimate for January, and Germany will publish the IFO Business Climate Index. Typically, the second inflation estimate aligns with the first, so a significant market reaction is unlikely. The IFO index is a secondary indicator with minimal influence on market sentiment.

Analysis of Fundamental Events:

Key events on Monday include speeches from representatives of the European Central Bank and the Bank of England, including Lombardelli, Balz, Ramsden, and Dhingra. However, as mentioned previously, the market currently has no pressing questions regarding monetary policy. All three central banks have made their positions clear. It is possible that after the latest UK inflation report, the BoE may adjust its stance on interest rates. However, it's important to remember that the BoE should prioritize economic growth over inflation at this stage.

General Conclusions:

On the first trading day of the new week, we anticipate low volatility in the markets. Both fundamental factors and macroeconomic data are expected to be weak. The British pound is currently experiencing a local uptrend, while the euro appears to be growing as well. However, we believe that these local trends will soon come to an end, as there are no strong reasons—particularly for the euro—to continue rising.

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.