Analysis of Monday's Trades

1H Chart of EUR/USD

The EUR/USD currency pair continued its upward movement on Monday. This likely came as no surprise, even though the macroeconomic backdrop throughout the day suggested a decline in the euro rather than its growth. The Consumer Price Index in Germany slowed to 2%, contrary to expectations, and retail sales declined more than traders had anticipated. However, in the first half of the day, the pair remained within a strong sideways range, and in the second half, it continued to rise calmly. This once again proves that no one in the market currently wants to buy the dollar under any circumstances. Another important point is that the dollar does not need any specific or local reasons to fall further. Yesterday, there were no fresh catalysts for selling the dollar, but those reasons have existed for five months already—since Donald Trump remains the President of the United States.

5M Chart of EUR/USD

In the 5-minute timeframe, two trading signals were formed on Monday. During the European session, the price bounced off the 1.1740–1.1745 area but managed to move down only 20 pips, as the market was in a flat phase at that time. In the second half of the day, the price broke through the 1.1740–1.1745 area, allowing novice traders to open long positions. By this morning, the nearest target at 1.1802 was reached.

Trading Strategy for Tuesday:

On the hourly timeframe, the EUR/USD pair continues its upward trend, which began during Trump's presidency and is likely to end under the next president. The primary reason for the continued decline of the U.S. dollar is that Trump remains president. Even in the absence of any fresh Trump-related news, this alone is enough to undermine the dollar's standing. The trade war, declining U.S. economy, and conflict between Trump and the Federal Reserve all reduce trust in the U.S. dollar—and no additional reasons are necessary.

On Tuesday, the EUR/USD pair may well continue its upward movement. For this to happen, it only needs to break above the 1.1800 level.

On the 5-minute timeframe, the following levels should be monitored: 1.1198–1.1218, 1.1267–1.1292, 1.1354–1.1363, 1.1413, 1.1455–1.1474, 1.1527, 1.1561–1.1571, 1.1609, 1.1666, 1.1740–1.1745, 1.1802, 1.1851, 1.1908.

On Tuesday, a large number of important events and reports are scheduled. The Eurozone will release several macroeconomic reports, including inflation data. Additionally, European Central Bank President Christine Lagarde is set to speak. In the U.S., Federal Reserve Chair Jerome Powell will deliver a speech, and the important ISM Manufacturing PMI will be released.

Core Trading System Rules:

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 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.