Yesterday's statements from Iran and Trump's subsequent reactions strengthened the U.S. dollar against several risk assets.

News about Iran's plans to mine the Strait of Hormuz triggered a sharp increase in demand for the U.S. dollar, indicating escalating geopolitical tensions. If implemented, this step would signify a new escalation of the conflict in the region and pose threats not only to international navigation but also a real risk of another surge in energy prices.

The Strait of Hormuz is one of the world's key maritime routes, through which a significant portion of global oil and gas supplies passes. Any blockage or limitation of movement in this strategically important region will inevitably affect global energy markets. The volatility caused by such statements is already reflected in financial markets, where the U.S. dollar, traditionally perceived as a safe-haven currency, is demonstrating strength.

Regarding reports, today we will see the long-awaited inflation report from Germany, as well as the harmonized consumer price index (HICP) as per European Union standards. These macroeconomic indicators, released in the first half of the day, are crucial for determining the euro's further trajectory. If the published data demonstrate a decline in the inflation rate, as some experts expect, this is likely to exert pressure on the euro's exchange rate. Lower inflation could be interpreted by the European Central Bank as a signal to reconsider the current monetary policy, potentially leading to easing.

As for the pound, today again sees a lack of any data from the UK, creating fertile ground for a potential bullish trend in the GBP/USD pair. In the absence of new data, traders' attention is likely to shift to earlier signals and overall market sentiment. This may facilitate a return of the GBP/USD pair to the weekly highs. Such movement will largely be driven by technical factors and speculative operations rather than fundamental changes in the UK economy.

If the data aligns with economists' expectations, it is advisable to employ the Mean Reversion strategy. If the data comes in significantly higher or lower than economists' expectations, the Momentum strategy would be the best approach.

Momentum Strategy (Breakout):

For the EUR/USD Pair:

• Long positions on a breakout of the 1.1640 level could lead to a rise of the euro to the 1.1669 and 1.1705 areas;
• Short positions on a breakout of the 1.1620 level could lead to a drop in the euro to the 1.1580 and 1.1555 areas;

For the GBP/USD Pair:

• Longs on a breakout of the 1.3460 level could lead to a rise of the pound to the 1.3488 and 1.3521 areas;
• Shorts on a breakout of the 1.3440 level could lead to a drop in the pound to the 1.3408 and 1.3374 areas;

For the USD/JPY Pair:

• Longs on a breakout of the 158.28 level could lead to a rise of the dollar to the 158.53 and 158.81 areas;
• Shorts on a breakout of the 157.99 level could lead to a sell-off of the dollar to the 157.69 and 157.30 areas;

Mean Reversion Strategy (Return):

For the EUR/USD Pair:

• I will look for shorts after a failed breakout above 1.1643 on a return below this level;
• I will look for longs after a failed breakout below 1.1612 on a return to this level;

For the GBP/USD Pair:

• I will look for shorts after a failed breakout above 1.3466 on a return below this level;
• I will look for longs after a failed breakout below 1.3422 on a return to this level;

For the AUD/USD Pair:

• I will look for shorts after a failed breakout above 0.7212 on a return below this level;
• I will look for longs after a failed breakout below 0.7162 on a return to this level;

For the USD/CAD Pair:

• I will look for shorts after a failed breakout above 1.3570 on a return below this level;
• I will look for longs after a failed breakout below 1.3539 on a return to this level;