The wave count on the 4-hour chart for EUR/USD remains unchanged. There is no talk of canceling the upward segment of the trend that began in January last year; however, the wave structure starting from July 1, 2025, has taken on an extended corrective form. In my view, the instrument has completed the formation of corrective wave 4, which has a non-standard internal structure. Within this wave, we observed exclusively corrective formations, so there is no doubt about its corrective nature.

In my opinion, the construction of the upward segment of the trend has not been completed, and its targets are spread as high as the 25th level. In the coming weeks, we may expect a continuation of the upward wave sequence, which could take on a five-wave form. However, there is no confidence that an impulsive segment of the trend is currently being formed, so the entire upward wave sequence may end after three waves. In that case, the construction of a new downward segment—also corrective—has already begun.

The EUR/USD exchange rate barely changed during Wednesday, but the most interesting events are still ahead. Today, the World Economic Forum is taking place in Davos, and U.S. President Donald Trump even managed to arrive late. Because of his delay, a meeting with German Chancellor Friedrich Merz was canceled. However, Trump was unlikely to be particularly upset by this. At present, Europe is divided into two camps (so to speak) over the Greenland issue. The first camp is ready to sacrifice the Danish island in order not to escalate the conflict with America. The second camp is ready to respond with tough sanctions and tariffs to Trump's claims on Greenland. Which side will prevail remains an open question, but in Davos Trump was expected to meet with European leaders in order to ease tensions.

However, in his speech, the U.S. president did not ignore the "long-suffering Europe." He stated that he loves the European Union very much, but that in recent years Europe has been moving in the wrong direction. Trump believes that Europe is mired in uncontrolled migration and also noted that the development of the European economy is based on government spending. Presumably, the leader of the American nation could explain exactly how European countries should develop, but at the moment a completely different topic is on the agenda. Before the end of the day, Trump may meet with some European leaders, so new information regarding the Greenland issue may emerge soon. For now, demand for the U.S. currency continues to decline, which fully corresponds to the news background. Let me remind you that throughout last year the market reacted to the escalation of the trade war by selling the dollar. This is exactly what we are seeing in 2026 as well. Even geopolitical conflicts no longer interest the market—only tariffs do.

Overall Conclusions

Based on the EUR/USD analysis, I conclude that the instrument continues to build an upward segment of the trend. Donald Trump's policies and the Federal Reserve's monetary policy remain significant factors weighing on the U.S. dollar in the long term. The targets of the current trend segment may extend as far as the 25th level. However, to reach these targets, the market must complete the formation of an extended wave 4. At the moment, we see only the market's intention to continue forming this wave. Therefore, a decline toward the 15th level can be expected in the near term.

On a smaller timeframe, the entire upward segment of the trend is visible. The wave structure is not entirely standard, as the corrective waves differ in size. For example, the higher-degree wave 2 is smaller than the internal wave 2 within wave 3. However, this also happens. Let me remind you that it is best to identify clear and understandable structures on charts rather than strictly tying analysis to every single wave. At present, the upward structure raises no doubts.

Core Principles of My Analysis:

1. Wave structures should be simple and clear. Complex structures are difficult to trade and often signal upcoming changes.
2. If there is no confidence in what is happening in the market, it is better to stay out.
3. There is no and never can be 100% certainty about market direction. Do not forget to use protective Stop Loss orders.
4. Wave analysis can be combined with other types of analysis and trading strategies.