Despite the U.S. tightening protectionist measures, the American dollar managed to regain all losses against riskier assets.

The lack of clarity from Washington has created confusion worldwide regarding Trump's tariff policy. The uncertainty surrounding trade relations and potential retaliatory measures from other countries has compelled investors to seek refuge in assets considered safer, with the U.S. dollar traditionally occupying this role.

However, this situation is double-edged. On one hand, the demand for the dollar as a safe haven may temporarily stabilize its exchange rate or even lead to some strengthening. On the other hand, a persistent trade war and policy unpredictability may undermine confidence in the American economy in the long run, which would be detrimental to the dollar.

Today, there is no statistical data from the eurozone in the first half of the day, so pressure on the euro may persist. The absence of new economic data that could signal recovery or, conversely, deterioration in the region leaves the euro vulnerable to external factors. Traders, deprived of the ability to rely on specific figures, tend to react to broader market sentiment and geopolitical events. Factors that could continue to exert pressure on the euro include the potential escalation of trade relations between the EU and the U.S. and ongoing geopolitical tensions.

As for the British pound, traders will focus on the publication of retail sales data from the Confederation of British Industry in the first half of the day. This metric is an important indicator of consumer activity and, consequently, the state of the British economy. Strong figures could support the pound, signaling robust demand and potential GDP growth, while weak results could weigh on it. In the second half of the day, the focus will shift to the Bank of England. Parliamentary hearings will take place, during which the central bank's latest reports on monetary policy will be discussed. This event offers a unique opportunity to gain deeper insight into the views of the Monetary Policy Committee members on the current economic situation, inflation risks, and future interest rate prospects.

If the data aligns with economists' expectations, it's best to act using the Mean Reversion strategy. If the figures significantly exceed or fall short of economists' expectations, the Momentum strategy would be the best approach.

Momentum Strategy (Breakout):

For the EUR/USD Pair:

• Buy on a breakout of the level 1.1788, which could lead to the euro rising to the range of 1.1810 and 1.1834.
• Sell on a breakout of the level 1.1767, which could lead to the euro falling to the range of 1.1745 and 1.1719.

For the GBP/USD Pair:

• Buy on a breakout of the level 1.3499, which could lead to the pound rising to the range of 1.3530 and 1.3555.
• Sell on a breakout of the level 1.3470, which could lead to the pound falling to the range of 1.3445 and 1.3400.

For the USD/JPY Pair:

• Buy on a breakout of the level 155.32, which could lead to the dollar rising to the range of 155.67 and 156.07.
• Sell on a breakout of the level 154.95, which could lead to dollar sell-offs in the range of 154.63 and 154.35.

Mean Reversion Strategy (Reversal):

For the EUR/USD Pair:

• Look for short positions after a failed breakout beyond 1.1793 on a return below this level.
• Look for long positions after a failed breakout beyond 1.1762 on a return to this level.

For the GBP/USD Pair:

• Look for shorts after a failed breakout beyond 1.3504 on a return below this level.
• Look for longs after a failed breakout beyond 1.3470 on a return to this level.

For the AUD/USD Pair:

• Look for shorts after a failed breakout beyond 0.7078 on a return below this level.
• Look for longs after a failed breakout beyond 0.7051 on a return to this level.

For the USD/CAD Pair:

• Look for shorts after a failed breakout beyond 1.3719 on a return below this level.
• Look for longs after a failed breakout beyond 1.3684 on a return to this level.