The European currency remains in a very difficult position after Donald Trump initiated military intervention in Iran. The construction of a downward corrective wave structure may have completed in the a-b-c formation, but events in the Middle East have made corrections. At this time, the corrective structure has taken on a five-wave form, but if the news background maintains the character of the past week, the downward wave structure could become more extended, and the entire wave pattern will require adjustments.

Nothing is currently helping buyers. On Friday, U.S. data could have reasonably increased demand for the European currency or, more specifically, decreased demand for the American dollar. Reports on the U.S. labor market and unemployment disappointed once again, undoing all the gains from January. However, the market's reaction to these reports was restrained, which once again underscores the persistence of bearish sentiment among market participants. If this sentiment persists next week due to geopolitical factors, no positive economic data will allow the EUR/USD instrument to transition into an upward trend.

Next week, there will be very few economic events in the European Union. What data will we learn? Only industrial production, trade balance, and inflation in Germany, and industrial production in the Eurozone. This is insufficient for the euro to strengthen against the dollar. Moreover, the news background in Europe will be weak. Therefore, all market attention will again be focused on Donald Trump, Iran, and the most important U.S. economic reports, which influence the Federal Reserve's monetary policy. There will be many reports in America. In the last few days, the intensity of the bombings by Iran against the countries of the Persian Gulf has decreased, but at the same time, Donald Trump is considering conducting a ground operation to seize and destroy all of Iran's stockpiles. The conflict could escalate in the new week with renewed strength.

Wave Pattern for EUR/USD:

Based on the analysis of EUR/USD, I conclude that the instrument continues to build an upward trend section. Trump's policies and the Federal Reserve's monetary policy remain significant factors in the long-term decline of the American currency. The targets for the current trend section may extend up to the 25th figure. At this moment, I believe the instrument remains within the global wave 5, so I expect price increases in the first half of 2026. The corrective structure a-b-c-d-e could be completed at any moment, as it has already taken a convincing form. I believe it is now prudent to identify areas and levels for new purchases, with targets around 1.2195 and 1.2367, which correspond to the 161.8% and 200.0% Fibonacci.

Wave Pattern for GBP/USD:

The wave pattern for the GBP/USD instrument appears quite clear. The global wave 5 may take on a much more extended form than it currently has. I believe the corrective wave structure will complete soon, after which the upward trend will resume. Therefore, I can now advise seeking opportunities for new purchases with targets positioned above the 39 figure. In my view, under Trump, the British pound has every chance of rising to $1.45-$1.50, and the upward trend does not appear to be over.

Main Principles of My Analysis:

1. Wave structures should be simple and understandable. Complex structures are difficult to trade and often lead to changes.
2. If there is no confidence in what is happening in the market, it is better not to enter.
3. There is never 100% certainty about the direction of prices. Always remember to use protective stop-loss orders.
4. Wave analysis can be combined with other types of analysis and trading strategies.