empty
28.03.2025 08:10 PM
EUR/USD Analysis – March 28th

This image is no longer relevant

The wave structure on the 4-hour chart for EUR/USD threatens to evolve into a more complex formation. A new downward structure began forming on September 25, taking the shape of an impulsive five-wave pattern. Two months ago, a corrective upward structure began, which should consist of at least three waves. The wave structure of the first wave was quite clear, so I continue to expect the second wave to take a defined form as well. However, the size of this wave is now so significant that it threatens to seriously alter the current wave count.

The news backdrop continues to support sellers more than buyers when it comes to economic data. All U.S. reports in recent months have shown one thing: the economy is not experiencing any serious problems and shows no signs of slowing to concerning levels. However, the U.S. economy could change dramatically in 2025 due to Donald Trump's policies. The Fed may cut interest rates more frequently, and tariffs (as well as retaliatory ones) could hit economic growth. If not for the latest developments, I would still expect the euro to decline with a 90% probability. But anything is still possible.

The EUR/USD pair rose by 60 basis points on Thursday. Friday started off quite optimistically for the U.S. dollar. Germany's unemployment rate increased, and the number of unemployed rose more than expected, which led to a drop in demand for the euro. However, at the beginning of the U.S. session, the PCE (Personal Consumption Expenditures) price index was released. And a mere 0.1% beat of the forecast was enough to trigger renewed dollar selling.

Undoubtedly, the primary reason behind the dollar's renewed decline was not the PCE index, but Donald Trump's new tariffs. His combative remarks toward any country planning retaliatory measures against the U.S. also added fuel to the fire. According to Trump, only he has the right to decide who can impose import tariffs and against whom — other countries, in his view, do not have this right. Therefore, any retaliatory sanctions from the European Union will be met with new U.S. tariffs. Clearly, things are not heading toward de-escalation, negotiations, or a trade deal. Naturally, demand for the U.S. dollar is falling again. The market has grown used to reacting to each new round of Trump tariffs by selling the dollar. So neither yesterday nor today saw anything surprising. Later today, markets will also see the U.S. consumer sentiment index, but I believe the dollar's decline this time will be short-lived.

This image is no longer relevant

General Conclusions

Based on the current EUR/USD analysis, I conclude that the instrument is still in a downward trend segment, although it could soon shift to an upward one. A fresh rise in quotes may trigger a complete transformation of the entire wave structure. Since the wave count is currently challenged by the news backdrop, I cannot recommend selling the instrument — even though the current levels look extremely attractive for shorting, provided the wave picture remains intact. However, Donald Trump continues to exert pressure on the dollar, making the formation of wave 3 practically impossible.

On the higher wave scale, the wave structure has evolved into an impulsive pattern. We are likely looking at a new long-term bearish wave set, but the news background, especially coming from Donald Trump himself, has the power to turn everything upside down.

Key Principles of My Analysis:

  1. Wave structures should be simple and easy to understand. Complex patterns are hard to trade and often subject to change.
  2. If you're not confident in the current market situation, it's better to stay out.
  3. There is never 100% certainty about the market's direction. Always use Stop Loss protective orders.
  4. Wave analysis can be combined with other types of analysis and trading strategies.
Chin Zhao,
Analytical expert of InstaForex
© 2007-2025
Select timeframe
5
min
15
min
30
min
1
hour
4
hours
1
day
1
week
Earn on cryptocurrency rate changes with InstaForex
Download MetaTrader 4 and open your first trade
  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    JOIN CONTEST

Recommended Stories

EUR/USD Analysis – April 7th

The wave structure on the 4-hour chart for EUR/USD has transformed into a bullish one. I believe no one doubts that this transformation occurred solely due to the new U.S

Chin Zhao 19:25 2025-04-07 UTC+2

GBP/USD Analysis – April 7th

The wave structure of GBP/USD has also shifted toward a bullish, impulsive formation—"thanks" to Donald Trump. The wave pattern is nearly identical to that of EUR/USD. Up until February

Chin Zhao 19:22 2025-04-07 UTC+2

Weekly Forecast Based on Simplified Wave Analysis for GBP/USD, AUD/USD, USD/CHF, EUR/JPY, EUR/GBP, and US Dollar Index – April 7th

In the first half of the upcoming week, price movements are expected to be sideways along the boundaries of calculated resistance zones. Toward the weekend, a downward move may resume

Isabel Clark 10:20 2025-04-07 UTC+2

Weekly Forecast Based on Simplified Wave Analysis for EUR/USD, USD/JPY, GBP/JPY, USD/CAD, NZD/USD, and Gold – April 7th

In the upcoming week, prices are expected to move within a sideways range, confined by calculated opposing zones. Early in the week, there's a high likelihood of an upward movement

Isabel Clark 10:10 2025-04-07 UTC+2

EUR/USD Analysis on April 2, 2025

The wave pattern on the 4-hour EUR/USD chart is on the verge of transforming into a more complex structure. Since September 25 of last year, a new downward wave structure

Chin Zhao 20:25 2025-04-02 UTC+2

GBP/USD Analysis on April 2, 2025

The wave pattern for GBP/USD remains somewhat ambiguous, though generally manageable. Currently, there's still a strong likelihood of a long-term downward trend forming. Wave 5 has taken a convincing shape

Chin Zhao 20:23 2025-04-02 UTC+2

EUR/USD Analysis – April 1: EU Inflation Continues to Fall

The wave structure on the 4-hour EUR/USD chart risks evolving into a more complex formation. On September 25 of last year, a new bearish structure began to take shape, forming

Chin Zhao 20:05 2025-04-01 UTC+2

Analysis for GBP/USD on April 1, 2025

The wave structure for GBP/USD remains somewhat ambiguous but generally manageable. Currently, there is a high probability of a long-term bearish trend formation. Wave 5 has taken on a convincing

Chin Zhao 20:00 2025-04-01 UTC+2

EUR/USD Analysis – March 31st

The wave structure on the 4-hour EUR/USD chart is at risk of transforming into a more complex formation. On September 25 of last year, a new downward structure began forming

Chin Zhao 20:10 2025-03-31 UTC+2

GBP/USD Analysis – March 31: The Pound Takes a Break

The wave structure for GBP/USD remains somewhat ambiguous, though overall acceptable. Currently, there is still a high probability of a long-term downward trend formation. Wave 5 has taken a convincing

Chin Zhao 20:08 2025-03-31 UTC+2
Can't speak right now?
Ask your question in the chat.
Widget callback
 

Dear visitor,

Your IP address shows that you are currently located in the USA. If you are a resident of the United States, you are prohibited from using the services of InstaFintech Group including online trading, online transfers, deposit/withdrawal of funds, etc.

If you think you are seeing this message by mistake and your location is not the US, kindly proceed to the website. Otherwise, you must leave the website in order to comply with government restrictions.

Why does your IP address show your location as the USA?

  • - you are using a VPN provided by a hosting company based in the United States;
  • - your IP does not have proper WHOIS records;
  • - an error occurred in the WHOIS geolocation database.

Please confirm whether you are a US resident or not by clicking the relevant button below. If you choose the wrong option, being a US resident, you will not be able to open an account with InstaForex anyway.

We are sorry for any inconvenience caused by this message.