The US dollar regained some positions against risk assets yesterday. The encouraging data on jobless claims in the US, demonstrating the resilience of the American labor market, combined with the escalation of the trade conflict between the US and China, had a noticeable impact on the currency markets. This combination of factors led to a moderate strengthening of the US dollar, as traders once again turned to the "safe haven" during periods of uncertainty.

The decrease in initial jobless claims indicates that the American economy remains resilient despite potential slowdowns in other sectors. This strengthens confidence in the dollar as a reliable currency, especially as other economic regions face challenges. Simultaneously, the intensification of trade disputes between the world's two largest economies—the US and China—has raised new concerns about global economic growth. Trade wars, tariffs, and retaliatory measures create uncertainty, which traditionally boosts demand for less risky assets, such as the US dollar.

Today's trading day in European markets is expected to be busy, as traders will need to digest a cascade of macroeconomic data from leading Eurozone economies. France will be in the spotlight as it releases its GDP report. Changes in this key indicator serve as a barometer of the country's overall economic activity and can signal rates of growth or a slowdown. Along with the GDP data, the consumer price index, reflecting inflation levels, is also expected to be published.

Data from Germany, the Eurozone's largest economy, will be equally significant. The unemployment rate figures will once again showcase the state of the German labor market, which is one of the main drivers of economic growth. Concurrently, the anticipated consumer price index in Germany will also be closely examined. Given Germany's role in the Eurozone's overall structure, these figures will have a direct impact not only on the euro.

As for the British pound, today's trading session in the first half of the day will be marked by heightened attention to speeches by monetary authorities, particularly those of Bank of England Monetary Policy Committee member Huw Pill. His comments are likely to focus on possible scenarios for UK interest rate cuts. This statement is particularly significant for market players, as it may exert pressure on the British pound.

If the data aligns with economists' expectations, it is advisable to act based on the Mean Reversion strategy. If the data significantly diverges from economists' expectations, the Momentum strategy would be the best approach.

Momentum Strategy (on Breakout):

For the EUR/USD Pair

• Long positions on a breakout of the level 1.1830 may lead to an increase in the euro to the levels of 1.1850 and 1.1867;
• Shorts on a breakout of the level 1.1800 may lead to a decline in the euro to the levels of 1.1788 and 1.1767;

For the GBP/USD Pair

• Longs on a breakout of the level 1.3500 may lead to an increase in the pound to the levels of 1.3525 and 1.3555;
• Shorts on a breakout of the level 1.3475 may lead to a decline in the pound to the levels of 1.3460 and 1.3430;

For the USD/JPY Pair

• Longs on a breakout of the level 155.95 may lead to an increase in the dollar to the levels of 156.30 and 156.73;
• Shorts on a breakout of the level 155.60 may lead to a decline in the dollar to the levels of 155.20 and 154.95;

Mean Reversion Strategy (on Return):

For the EUR/USD Pair

• Shorts will be sought after a failed breakout above 1.1819 on a return below this level;
• Longs will be sought after a failed breakout below 1.1791 on a return to this level;

For the GBP/USD Pair

• Shorts will be sought after a failed breakout above 1.3505 on a return below this level;
• Longs will be sought after a failed breakout below 1.3472 on a return to this level;

For the AUD/USD Pair

• Shorts will be sought after a failed breakout above 0.7147 on a return below this level;
• Longs will be sought after a failed breakout below 0.7116 on a return to this level;

For the USD/CAD Pair

• Shorts will be sought after a failed breakout above 1.3675 on a return below this level;
• Longs will be sought after a failed breakout below 1.3653 on a return to this level;