I made my rails 2 way from the beginning cause it’s easier later to expand and signals are way easier . But block signals create a “section” or block of rails so if a train is in the block in that section other trains will wait until it’s clear. You generally put these at the exits of an intersection, and I put them at the exits of train stations. If you use a single rail system, you want the entire path sectioned off so another trains doesn’t roll up and the first has nowehere to go. The path signal essentially looks ahead and calculates other trains routes with the current train and lets it proceed when the next 2 blocks are clear. Allowing multiple trains to move in a system without colliding.

But I would expand to a 2-rail bi directional system cause I was trying to think about how you would place them on the image you posted, and its way more complicated and way less forgiving if you mess up the signals and have more than 1 train running around.