It is placed at the top rail but for some reason the blue train affects it.
Adding another signal in front of the blue train makes this signal green.
Moving it one position to the left also makes it green.
upd: Moving the right signal one position down makes circled signal flash red-green-blue with an error "Cannot divide segments"
I can't understand why is this signal red.
Re: I can't understand why is this signal red.
Because the part with the blue train and the small curve before the horizontal rail are the same block. Hold a signal in hand and it will show you.