The EUR/USD currency pair managed to recover slightly on Thursday after a two-week decline, which itself was a correction against a month-long rise. Thus the underlying uptrend that began in late July effectively remains intact. In our view, the euro should continue to rise in the medium term, regardless of the Federal Reserve's plans and actions, and even despite geopolitical developments. However, if things were that simple in the FX market, every trader would be a millionaire.

For this review, we decided not to focus on Nonfarm Payrolls or the unemployment rate, which would be logical, but on the prospects for Fed monetary policy. At present, most market participants are confident the Fed will tighten policy in September. We believe the Fed will once again leave the key rate unchanged. Why? The Fed makes decisions based strictly on macroeconomic data. It did so previously. Now the US central bank is headed by a person closely aligned with Donald Trump, so one inevitably has to view monetary policy prospects through the prism of the US president's wishes. We believe all traders understand why Trump appointed Warsh as Fed Chair. To be precise, nothing is known for certain, but anyone who follows Trump's actions and statements can say with confidence: the American president makes decisions that primarily benefit himself.

The US president continues to demand rate cuts because they personally benefit him. Trump's campaign slogans promised a new era of economic prosperity and benefits for every American who votes Republican. Eighteen months later, it is clear: many Americans have suffered losses because Trump became president. Trump failed to conclude any significant wars, provoked a worldwide energy crisis, started a trade war, increased the US national debt by $3 trillion, and failed to address the budget deficit and the negative trade balance. In short, none of the campaign promises were fulfilled. The promised era of financial prosperity has not arrived.

On the contrary, Americans now pay more for foreign goods, gasoline, and any goods and services whose prices include transportation. Thus, low interest rates are useful to Trump so the economy can accelerate and he can claim from the podium something like "the President promised, the President delivered!" Therefore, Warsh was appointed to influence the Monetary Committee to cut the key rate. The White House does not care about inflation, and current US labor market indicators (which directly affect economic growth) do not allow the Fed to tighten policy.

If Warsh were not connected to Trump, we would admit the Fed might fight inflation. With Warsh, we do not believe that. Most market participants think the Fed Chair will not be able to convince the FOMC, and the FOMC cannot make decisions that are openly harmful to most Americans. We remind you that virtually all of Trump's decisions have not benefited the American people. That is why the ratings of the controversial president continue to hit negative records.

The average volatility of the EUR/USD pair over the last 5 trading days as of September 4 is 51 pips and is characterized as "medium." We expect the pair to move between 1.1568 and 1.1670 on Friday. The major linear regression channel has turned upward, indicating an uptrend. The CCI indicator entered the oversold area, signaling a potential end to the correction.

Nearest support levels:

S1 – 1.1597

S2 – 1.1536

S3 – 1.1475

Nearest resistance levels:

R1 – 1.1658

R2 – 1.1719

R3 – 1.1780

Trading recommendations:

The EUR/USD pair continues an upward trend on the 4?hour TF, which may be the start of a new leg of a global uptrend on higher TFs. The global fundamental backdrop for the dollar remains negative, but in 2026, geopolitics first, and then the Fed's hawkish stance, provided strong support for the US currency. However, those factors no longer support the dollar now. If the price is below the moving average, shorts can be considered on corrective grounds, with targets at 1.1568 and 1.1536. Above the moving average, long positions remain relevant with targets at 1.1670 and 1.1719.

Explanations for the illustrations:

• Linear regression channels help identify the current trend. If both are directed the same way, the trend is currently strong.
• The moving average line (settings: 20, 0, smoothed) defines the short-term trend and the direction in which to trade.
• Murray levels are target levels for moves and corrections.
• Volatility levels (red lines) indicate the probable price channel the pair will trade within over the next day, based on current volatility.
• The CCI indicator entering oversold territory (below -250) or overbought territory (above +250) signals a forthcoming trend reversal.

Several macroeconomic publications are scheduled for Friday. For example, the EU will publish a retail sales report, but who in the market is interested in retail sales right now? All traders' attention is focused on US inflation and labor market data because no one yet understands what further actions the US central bank will take. Today, Nonfarm Payrolls and the unemployment rate will be released, potentially changing traders' expectations about the Federal Reserve's key rate in September.

Analysis of fundamental events:

Among Friday's fundamental events are speeches by Bank of England Governor Andrew Bailey and European Central Bank Chief Economist Philip Lane. In general, it is clear what to expect from both central banks in the near term, but additional comments and hints on the subject will certainly not hurt. Recall that the baseline scenario now is another ECB policy tightening this autumn, and a possible BoE tightening if UK inflation continues to rise.

The geopolitical backdrop still leaves much to be desired. The United States and Iran are not conducting any negotiations at this time; the Strait of Hormuz remains closed or partially closed, and Yemeni Houthis continue to blockade Saudi Arabia. Donald Trump has vowed an unprecedented economic operation to destroy Iran and threatens sanctions against any countries that interact with it. However, so far no one has supported Trump's plan to destroy Iran, and whether it will be implemented is unknown. What is known is the first US attacks in a month on launch sites near the Strait of Hormuz. Iran responded by announcing a military operation against the US and its regional allies. Tensions in the Middle East are heating up again.

General conclusions:

During the last trading day of the week, currency pairs may show strong movements. The euro can be traded today from the 1.1655–1.1665 area, and the pound from the 1.3456–1.3476 and 1.3587–1.3598 areas. In general, the decline of the euro and the pound may continue, since technical trends for both currency pairs have changed to downward. However, US Nonfarm Payrolls and the unemployment rate can strongly affect traders' sentiment, and medium-term trends remain upward. The dollar can still only count on corrections.

Key Rules of the Trading System:

1. The strength of a signal is determined by the time it takes to form the signal (rebound or breakout). The less time taken, the stronger the signal.
2. If two or more trades were opened at a certain level based on false signals, all subsequent signals from that level should be ignored.
3. In a range (flat), any pair can generate many false signals or may not produce any at all. Technical levels may be disregarded.
4. On the hourly timeframe, trading signals from the MACD indicator should be acted upon only when volatility is high, and a trend line or trend channel confirms the trend.
5. If two levels are positioned too close to each other (within 5-20 pips), they should be considered a support or resistance area.
6. After moving 15 pips in the right direction, a stop-loss should be set to break even.

What to Look for on the Charts:

Price levels (areas) of support and resistance are levels that serve as targets when opening buy or sell trades, or as sources of signals.

Red lines indicate channels or trend lines that illustrate the current trend and show the preferred direction for trading.

The MACD indicator (14,22,3) — the histogram and signal line — is an auxiliary indicator that can also be used as a source of signals.

Important speeches and reports (contained in the news calendar) can significantly influence the movement of currency pairs. Therefore, during their release, trading should be approached with utmost caution, or traders should exit the market to avoid sudden reversals against the preceding movement.

Beginner forex traders should remember that not every trade can be profitable. Developing a clear strategy and practicing money management are key to long-term success in trading.

1H chart of the GBP/USD pair

The GBP/USD pair also rose during Thursday even though the macro backdrop suggested a decline. Recall that this week only the US ISM services business activity index supported the dollar; all other reports did not. However, yesterday, when the ISM index was released, the US currency fell. We noted earlier that a technical correction has been unfolding in the market over the past two weeks. Such corrections occur independently of fundamental or macroeconomic background. The market begins to take profits on long positions, which is why we observe declines. This is why the macro backdrop and the pair's movements did not match this week. Regarding Federal Reserve policy, we still do not believe the key rate will be raised in September. We see no basis for that. Therefore, there is no reason for stronger dollar gains beyond a correction.

5M chart of the GBP/USD pair

On the 5-minute TF on Thursday, one buy signal formed. During the Asian session, the price bounced from the 1.3456–1.3476 area and moved only upward until the end of the day. Thus, traders could open long positions in the morning and close them in profit of about 30–40 pips in the evening.

How to trade on Friday:

On the hourly TF, the GBP/USD pair continues a downward corrective trend. In our view, the pound should continue to rise in the medium term under any scenario, but it is currently in a correction. On the weekly TF, the move from the lower boundary of the lateral channel toward the upper boundary continues, and this move may not be complete. Last Friday improved the mood for the US dollar, but that support is unlikely to last long.

On Friday, novice traders may consider short positions targeting 1.3456–1.3476 if the price bounces from the 1.3587–1.3598 area. Long positions can be maintained with targets at 1.3587–1.3598 after a bounce from the 1.3456–1.3476 area.

On the 5-minute TF, you can trade the levels 1.3259–1.3267, 1.3319–1.3331, 1.3380–1.3386, 1.3456–1.3476, 1.3587–1.3598, 1.3631–1.3641, 1.3695, 1.3741. No major events are scheduled in the UK on Friday, but they are not needed. In the US, important reports will be released today that the market has been awaiting since Monday — Nonfarm Payrolls and the unemployment rate. High volatility is expected in the afternoon.

Key Rules of the Trading System:

1. The strength of a signal is determined by the time it takes to form the signal (rebound or breakout). The less time taken, the stronger the signal.
2. If two or more trades were opened at a certain level based on false signals, all subsequent signals from that level should be ignored.
3. In a range (flat), any pair can generate many false signals or may not produce any at all. Technical levels may be disregarded.
4. On the hourly timeframe, trading signals from the MACD indicator should be acted upon only when volatility is high, and a trend line or trend channel confirms the trend.
5. If two levels are positioned too close to each other (within 5-20 pips), they should be considered a support or resistance area.
6. After moving 15 pips in the right direction, a stop-loss should be set to break even.

What to Look for on the Charts:

Price levels (areas) of support and resistance are levels that serve as targets when opening buy or sell trades, or as sources of signals.

Red lines indicate channels or trend lines that illustrate the current trend and show the preferred direction for trading.

The MACD indicator (14,22,3) — the histogram and signal line — is an auxiliary indicator that can also be used as a source of signals.

Important speeches and reports (contained in the news calendar) can significantly influence the movement of currency pairs. Therefore, during their release, trading should be approached with utmost caution, or traders should exit the market to avoid sudden reversals against the preceding movement.

Beginner forex traders should remember that not every trade can be profitable. Developing a clear strategy and practicing money management are key to long-term success in trading.

1H chart of the EUR/USD pair

The EUR/USD currency pair rebounded from 1.1584 on Thursday after a two-week correction and is now attempting to resume its upward trend. If you analyze all the macroeconomic releases this week and try to match them with the pair's moves, you will see no correlation. On Monday, Tuesday, and Wednesday, the macro backdrop should have prompted a rise in the US dollar, and on Thursday, a fall. However, in reality, we saw the exact opposite movements. For example, yesterday the US released a fairly good and important ISM services business activity index. It was the first overseas report this week to beat forecasts. Yet the US currency spent the entire day declining. Thus, the conclusion is obvious: the market is not reacting now to news that is not "mega-important." Today, unemployment and Nonfarm Payrolls will be published, and the market should react to reports of that caliber.

5M chart of the EUR/USD pair

On the 5-minute TF on Thursday, one buy signal formed. At the start of the European session, the price bounced from the 1.1584–1.1594 area, allowing traders to open long positions. Until the end of the day, the pair moved only up, so the trade could have yielded about 25–30 pips of profit.

How to trade on Friday:

On the hourly timeframe, the EUR/USD pair continues a correction after a month-long rise. Taking into account all events of recent months, we believe the euro should continue to rise steadily even without local support. The US dollar currently has no growth drivers except the market's almost religious faith in a Federal Reserve rate hike.

On Friday, novice traders may consider short positions targeting 1.1584–1.1594 if the price bounces from the 1.1655–1.1665 area. Longs can be opened if the pair holds above 1.1655–1.1665, with targets at 1.1745–1.1754.

On the 5-minute TF, consider the levels 1.1366–1.1377, 1.1461–1.1474, 1.1527–1.1531, 1.1584–1.1594, 1.1655–1.1665, 1.1745–1.1754, 1.1830–1.1837. On Friday, the EU will publish a retail sales report, and the US will release the crucial Nonfarm Payrolls and unemployment rate. Thus, volatility today may be high.

Key Rules of the Trading System:

1. The strength of a signal is determined by the time it takes to form the signal (rebound or breakout). The shorter the time taken, the stronger the signal.
2. If two or more trades were opened at a certain level based on false signals, all subsequent signals from that level should be ignored.
3. In a range (flat), any pair can generate many false signals or may not produce any at all. Technical levels may be disregarded.
4. On the hourly timeframe, trading signals from the MACD indicator should be acted upon only when volatility is high, and a trend line or trend channel confirms the trend.
5. If two levels are positioned too close to each other (within 5-20 pips), they should be considered a support or resistance area.
6. After moving 15 pips in the right direction, a stop-loss should be set to break even.

What to Look for on the Charts:

Price levels (areas) of support and resistance are levels that serve as targets when opening buy or sell trades, or as sources of signals.

Red lines indicate channels or trend lines that illustrate the current trend and show the preferred direction for trading at the moment.

The MACD indicator (14,22,3) — the histogram and signal line — is an auxiliary indicator that can also be used as a source of signals.

Important speeches and reports (contained in the news calendar) can significantly influence the movement of currency pairs. Therefore, during their release, trading should be approached with utmost caution, or traders should exit the market to avoid sudden reversals against the preceding movement.

Beginner forex traders should remember that not every trade can be profitable. Developing a clear strategy and practicing money management are key to long-term success in trading.

Americans like to live well. They are used to living well. Certainly not all Americans throw money around and can buy whatever they wish. Still, no one will deny that, in terms of standard of living, the American nation surpasses many on this planet. American life is, first and foremost, about money. And about credit. Prices in the US are high, so any increase in the cost of goods hits the middle and lower classes. That was the preamble; now the article begins.

The US Energy Information Administration reported that diesel inventories have fallen to the lowest level on record. Diesel prices have risen to their highest level since 2022 and may soon set an all-time record. The average gasoline price in the US reached $5.80 per gallon, and many experts predict further increases. Remember the panic a month or two ago in the US about fuel prices rising to $4–4.5 per gallon? Imagine the mood now among American businesses and consumers.

Experts note that fuel prices continue to rise for two reasons. First, the ongoing Middle East conflict, which blocks the Strait of Hormuz and access to Middle Eastern oil for world markets. Second, the White House's policy of ramping up energy exports. Accordingly, the global supply of petroleum products is decreasing, and US inventories are falling with it. Thus, the US face a double shortage of oil and fuel. That is why prices are rising.

Now the main question — whom to blame for this? If I approached grandmothers on a bench near the nearest house, they would probably be able to give the right answer as well. Bitcoin is out of favor right now. Everyone is talking about Trump's war with Iran. Possibly the conflict between Moscow and Kyiv also negatively affected the global oil and fuel market, since Ukrainian drones and missiles damaged many refineries in Russia. Moscow imposed a ban on fuel exports and even began importing gasoline itself. Therefore, the global energy situation is only deteriorating. It is not surprising that fuel prices are rising.

However, for us America and its problems matter, because they are reflected in the dollar's exchange rate. In my opinion, the Republican Party's chances of winning Congress were low even three months ago. Now, with gasoline costing almost $6 per gallon, they can be considered zero. At best, the Republicans will retain control of the Senate...

Wave picture for EUR/USD:

Based on my analysis of EUR/USD, I conclude that the instrument remains within a local upward segment of the trend as part of the first wave of a new global uptrend. It should be acknowledged that the trend segment beginning in January this year could take the form A-B-C-D-E. If this assumption is correct, prices will continue to decline with targets located below the low of wave C — 1.1325. However, I consider that scenario an alternative. I believe that a new upward trend segment began in June and will return the euro to the 1.20 area.

Wave picture for GBP/USD:

The wave picture of GBP/USD has become fairly clear but may be complicated. On the charts, we see a clear, complete corrective A-B-C structure. Therefore, I expect the construction of an upward set of waves. However, the current wave labeling for EUR/USD raises doubts. The euro's labeling could take a five-wave downward form, and then GBP/USD could also fall to the 1.31 area. In that case, the pound's wave labeling would also take a somewhat different form and structure. For now, this is a reserve scenario.

Main principles of my analysis:

1. Wave structures should be simple and understandable. Complex structures are hard to trade and often change.
2. If you are not confident about what is happening in the market, it is better not to enter it.
3. There is no and can never be one-hundred-percent confidence in the direction of movement. Don't forget protective stop-loss orders.
4. Wave analysis can be combined with other types of analysis and trading strategies.

August ISM Services was indeed fairly strong. And if not for significant accompanying flaws (which we will discuss below), the release would have favored the greenback. However, as we have repeatedly seen, the devil is in the details. ISM Services, unfortunately, was no exception.

The headline — the services business activity index — rose in August to 55.4 points from 54.1 in July. Most analysts had forecast a more modest rise to 54.3. The indicator has been in expansion territory for 26 consecutive months. The business activity subindex jumped from 59.1 to 61.7 points, while the new orders subindex rose to 60.9 (from 57.2). New orders have now been growing for 15 consecutive months, reaching the highest level since February 2023.

All this indicates that domestic demand in the services sector remains fairly resilient and that the US economy as a whole continues to expand.

But there is another side of the coin. The weakest component of the report was the employment section. The Employment Index subcomponent remained below the key 50-point mark for a second month, coming in at 47.8 in August (47.4 in July). The indicator remains below its 12-month average (48.8). In other words, the services sector continues to cut employment despite a noticeable improvement in business activity and new orders.

The US labor market looks weak even where economic activity remains relatively high.

In this context, ISM Services should be compared with earlier released macro data. For example, the employment component of the manufacturing ISM also fell — from 52.8 to 51.2 points. At the same time, new orders slipped three points (to 53.7), and backlogs fell to 51.8.

The JOLTS report also offered no optimism: vacancies in July were virtually unchanged at 7.27 million, while hires remained at 5.1 million. That is, the labor market is operating in a "low hires — low layoffs" mode. Companies are not rushing to fire employees, but they are less actively expanding payrolls. The ADP only exacerbated this picture: according to the August report, the US private sector added only 38,000 jobs last month (vs. a weak forecast of 47,000). This is the worst result since January.

Thus, three different sources — ISM, JOLTS and ADP — basically conveyed the same message. This is not yet a labor-market collapse, but the dynamics have clearly lost previous momentum. Under these conditions, this factor becomes especially important, since the Federal Reserve now has to balance inflation risks with growing signs of cooling in employment.

In other words, the August ISM Services cannot be called unequivocally "hawkish." Yes, the services economy is indeed accelerating. But growth in business activity is not translating into a corresponding rise in employment. The report, therefore, simultaneously signals strong demand and a weak labor market. That is why sellers of EUR/USD could not interpret Thursday's release in their favor.

Especially since the dollar came under additional pressure following a speech by Fed governor Christopher Waller. Unlike the hawkish rhetoric of Kevin Warsh in Jackson Hole, Waller took a softer stance. He said that if inflation in August continues to slow, he is ready to support a pause at the September meeting. That rhetoric acted like a "cold shower." Recall that at Jackson Hole, the Fed chair stated that absent convincing progress on inflation, the central bank might need to tighten further. After those remarks, the market sharply increased the probability of a September rate hike. On Thursday, one of the Fed's most influential officials effectively returned the alternative scenario — a pause — to the agenda.

Of course, much will depend on the August nonfarm payrolls to be published Friday. If the official US labor report disappoints, Waller's verbal messages will "play in new colors," and the greenback will face additional pressure. Judging by preliminary signals (weak ADP, sluggish hiring in JOLTS and falling employment in ISM Services), that outcome looks quite possible.

From a technical standpoint, the pair is currently testing resistance at 1.1630, which corresponds to the Tenkan-sen line on the D1 timeframe. If this level is breached, the Ichimoku indicator will form a bullish "Parade of Lines" signal. In addition, the price would sit between the middle and upper Bollinger Bands, also signaling a preference for long positions. The nearest target to the north is at 1.1660 (the upper boundary of the Kumo cloud on H4). The main target is 1.1710 (the upper Bollinger Band on the D1 timeframe), although achieving it will depend on the "color" of the August NFP.

The EUR/USD pair declined for six days, but the bears' advance may now be over. Overall, it can be said with confidence that the bears truly attacked only last Friday, when FOMC President Kevin Warsh spoke first, followed by a revision of the annual Nonfarm Payrolls data. Neither of these events was unequivocally bearish, although the dollar's appreciation can be explained if one looks hard enough for a reason. As I wrote earlier, the Nonfarm Payrolls report could have been much worse than it ultimately turned out to be, while Warsh's speech contained some hawkish undertones. However, if we call things by their proper names and do not try to see white in black, I see no reason for the dollar to rise even on Friday. The Nonfarm Payrolls report showed a negative reading, while Kevin Warsh merely spoke about high inflation but did not promise to raise interest rates or take any specific measures directly in September. The U.S. dollar rose to the base of imbalance 21, and the pair's decline has stopped there for now. From here, everything will depend mainly on the U.S. labor-market and unemployment data due on Friday. And I do not expect anything positive from these reports.

Overall, the fundamental backdrop, in my view, continues to fully support the bulls. First, any chart clearly shows that the euro began its advance from relatively low levels, compared with its average price over the past year. This means that it still has room to rise. Second, the market continues to doubt that the FOMC will tighten monetary policy in September, regardless of what statements Warsh makes. Third, U.S. economic data have recently brought nothing but disappointment. Fourth, geopolitics no longer supports the bears or the dollar. Fifth, the ECB may implement another monetary policy tightening this autumn. Sixth, the U.S. Treasury has decided to increase its purchases of long-term bonds, reducing demand for the dollar. Seventh, a new trade war between the United States and Canada, and between the United States and China, could begin in the near future. Eighth, the U.S. labor market is contracting, which could put an end to Warsh's hawkish initiatives. Thus, I currently see not a single reason for a bearish advance.

The latest U.S. labor-market data showed weak readings, inflation is slowing, and GDP growth is losing momentum. These three factors make me doubt that the FOMC will raise rates not only in September but also by the end of the year. In my view, the bears' only opportunity at present lies in a new escalation in the Middle East.

The current technical picture points to the bullish momentum remaining intact. Price has completely filled the latest bullish imbalance 21 and has even touched the previous bullish imbalance 20. The combined reaction to these two patterns could bring the bulls back into the market and resume the upward move. The bears will gain technical grounds for an advance only if both patterns are invalidated. The euro will also have to save the pound, which does not have such a strong support zone.

The fundamental backdrop on Thursday had little impact on traders' sentiment, despite the release today of the important U.S. ISM Services PMI. However, the dollar began declining long before the report was published. Given that the unemployment rate and Nonfarm Payrolls will be released tomorrow, I believe traders have begun preparing for these reports. And they do not expect anything good.

There are still a huge number of reasons for the bulls to attack in 2026, and even the outbreak of war in the Middle East has not reduced their number. Structurally and globally, Trump's policies, which led to a significant decline in the dollar last year, have not changed. At present, I see no significant factors supporting the U.S. currency, despite the FOMC's formally hawkish stance. Geopolitics, which supported demand for the U.S. currency throughout much of the first half of 2026, is no longer doing so. The conflict in the Middle East remains unresolved, but there have been no new hostilities from either Iran or the United States.

Economic Calendar for the United States and the European Union:

• European Union – Change in retail sales (09:00 UTC).
• United States – Change in Nonfarm Payrolls (12:30 UTC).
• United States – Unemployment rate (12:30 UTC).
• United States – Change in average hourly earnings (12:30 UTC).

On September 4, the economic calendar contains four releases, among which I cannot fail to highlight Nonfarm Payrolls and the unemployment rate—the two most important indicators. The impact of the fundamental backdrop on market sentiment on Friday could be strong in the second half of the day.

EUR/USD Forecast and Trading Tips:

In my view, the pair remains in the process of forming a bullish trend that paused for an entire year. The fundamental backdrop shifted sharply in favor of the bears six months ago, but the trend itself cannot be considered canceled or complete. From a long-term perspective, I would say that the pair is trading in a range. However, the range does not invalidate the broader bullish trend. Therefore, the bulls may well resume their advance after two liquidity sweeps of clearly defined lows. At present, bullish traders have an excellent support zone in the form of imbalance 20, where a new bullish signal may form. We have already seen a precise rebound from imbalance 21. I consider 1.1797 and 1.1850 to be the targets for a new advance in the euro.

The wave count on the four-hour chart for EUR/USD is becoming more complex. There is still no question of invalidating the upward trend segment (lower chart) that began in January of last year. On the contrary, we have seen a complete A-B-C corrective structure, which has most likely been completed. We never saw a convincing wave 5 within wave C. This wave took a truncated form, which also occurs from time to time. Let me remind you that classical wave structures are generally found only in textbooks. In real-life trading, traders and analysts should be more flexible in their analysis.

Unfortunately, the wave count may become more complex again at present. Wave C may take a three-wave form, the wave that follows it will be identified as wave D, and the entire trend segment beginning on January 27 will take a five-wave corrective form A-B-C-D-E. If this assumption is correct, wave D will take a three-wave form, and on August 21, EUR/USD entered the phase of forming wave E, whose low should be below the low of wave C at 1.1325. At the same time, however, this scenario is an alternative. Based on the fundamental backdrop, I am more inclined to expect the formation of a global upward wave.

The EUR/USD pair rose by 40 basis points on Thursday, raising a new series of questions. Since the beginning of the week, at least five important and notable reports have been released in the United States and the European Union, but they triggered a completely different market reaction than might have been expected. European consumer price inflation rose to 3.3%, increasing the chances of an ECB monetary policy tightening and should have supported the euro. The U.S. manufacturing PMI fell to 54.6, which should have supported the euro. The U.S. JOLTS report on job openings came in below market expectations, which should have supported the euro. The ADP report on changes in private-sector employment came in below forecasts, which should have supported the euro. During the first three days of the week, virtually every report should have supported the euro. However, demand for the U.S. dollar increased on all three days. Not significantly, but it did increase.

Today, the United States released its services PMI, which came in above market expectations. And it caused the dollar to decline. More precisely, demand for the U.S. currency declined for most of the day, while the ISM index had no impact. Based on everything said above, what conclusion can be drawn? The market is not interested in secondary economic data and is fully focused on tomorrow's payrolls and unemployment figures, as well as Fed policy, expectations for which are changing practically every day. At present, the market once again does not believe in monetary policy tightening, so demand for the U.S. currency may continue to decline.

Overall Conclusions

Based on my EUR/USD analysis, I conclude that the pair remains within a local upward trend segment as part of the first wave of a new global upward trend. It should be acknowledged that the trend segment beginning in January of this year may take the form of A-B-C-D-E. If this assumption is correct, the decline in prices will continue toward targets below the low of wave C at 1.1325. However, I consider this an alternative scenario. I believe that the formation of a new upward trend segment began in June, which will bring the euro back toward the 20 level.

On the higher timeframe, an upward trend segment can be seen, followed by the formation of an A-B-C corrective structure. This structure may take a five-wave form, but at present I consider it complete. If so, a new impulsive upward trend segment has begun to form.

Main Principles of My Analysis:

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

The GBP/USD pair has lost its bullish momentum, but the bullish advance is not yet over. In my view, saving the pound is in the hands of the euro. The euro is still maintaining a bullish bias at present and has not invalidated the last two bullish imbalances. These imbalances could save both European currencies. As I said earlier, I see no reason for the bears to advance. For example, it is extremely difficult to explain the decline in the euro and the pound this week. All of the U.S. economic reports released this week have, to varying degrees, created obstacles for the dollar. The geopolitical escalation in the Middle East was classified as "another escalation" by the end of the week. We have seen a huge number of such escalations over the past few months. If traders rushed to buy dollars every time this happened, the dollar would already have reached parity with the euro and the pound. Hawkish expectations strengthened last Friday, but traders continue to focus solely on Kevin Warsh's statements. Looking at the economic data, the Fed should arguably ease monetary policy rather than tighten it. Thus, I consider a resumption of the euro and pound's advance to be the most logical scenario.

Over the past month, the dollar has suffered numerous setbacks, including the U.S. Treasury's decision to increase the volume of long-term bond buybacks, weak monthly Nonfarm Payrolls reports, a weak annual Nonfarm Payrolls report, a slowdown in the Consumer Price Index, slower GDP growth, and a decline in market expectations for Fed monetary policy tightening. However, at the most critical moment, the bulls retreated despite having every card in their hands. All that remains is to hope for the euro and for the temporary nature of such actions by the bulls.

Do the bears have any prospects at present? In my view, very few. As we have already established, the fundamental backdrop does not support the U.S. dollar. However, it should not be forgotten that not everything in the market depends solely on the fundamental backdrop. From a long-term perspective, the market has been range-bound for about a year. We have seen three waves to the upside, and everything suggests that the bulls should continue their advance. However, over the past year, we have actually been seeing an alternation of three-wave structures and similar patterns. The liquidity sweep of the May 1 swing could serve as a basis for a new bearish leg, which would be completely inconsistent with the fundamental backdrop.

Geopolitics is no longer having a favorable impact on the dollar. Negotiations between the United States and Iran have failed once again and are no longer taking place. From time to time, Iran and the United States exchange strikes, threats, and ultimatums, which has had no effect whatsoever in terms of resolving the conflict and ending the war. No one can currently predict how much longer the conflict will continue. And the dollar cannot expect market support every time the two sides exchange strikes, which are occurring with notable regularity.

Technical analysis shows that the picture changed from bullish to bearish in just a few days, based on two highly ambiguous events. The euro may stop the pound's decline, but at present it is the bears who have two imbalances from which positions can be opened. The latest imbalance 27, which was initially bullish but is now an inverted bearish imbalance, has already elicited a market reaction. However, the pound's decline could end at any moment if the euro fails to break through its imbalances. Within the euro-pound pair, the euro holds the stronger position.

The fundamental backdrop on Thursday did not give the bears reason to expect another decline, while since the beginning of the week, traders have already ignored a large amount of weak U.S. economic data. Ahead of Friday, the dollar is declining, which best reflects market expectations for payrolls and unemployment.

The overall fundamental backdrop remains such that, in the long term, I can expect nothing other than a decline in the U.S. dollar. However, this decline appears to be postponed once again for some time. The war between Iran and the United States has not changed my long-term expectations. Geopolitics prompted the market to remember the dollar's safe-haven status for several months, but the conflict has already passed its most active phase. The prospects for FOMC monetary policy tightening remain ambiguous, while the market itself is constantly changing its expectations. Thus, in my view, any appreciation of the dollar is temporary and random in nature. I see no reason for a large-scale bearish advance.

Economic Calendar for the United States and the United Kingdom:

• United States – Change in Nonfarm Payrolls (12:30 UTC).
• United States – Unemployment rate (12:30 UTC).
• United States – Change in average hourly earnings (12:30 UTC).

On September 4, the economic calendar contains three releases, each of which can be considered important. The impact of the fundamental backdrop on market sentiment will be felt in the second half of the day on Friday.

GBP/USD Forecast and Trading Tips:

The long-term outlook for the pound remains bullish. After liquidity sweeps of the two most recent swings and the formation of a series of buy signals, the bulls may still resume their advance. Unfortunately, the bears have controlled the initiative over the past week, and all recent bullish patterns have been invalidated. The bears currently have technical grounds to push the pair lower. Only the euro may be able to save the pound. The liquidity sweep of the May 1 swing triggered the decline, and a sell signal formed inside inverted imbalance 27. It is difficult to say how long the pound will continue to fall. Two bullish imbalances on EUR/USD could potentially stop the decline. On Friday, the United States will release important labor-market and unemployment reports.

On Friday, September 4, the economic calendar contains at least two major releases. These are, of course, the Nonfarm Payrolls report and the unemployment rate. Needless to say, these reports will determine not only the dollar's performance on Friday but also the outlook for Fed monetary policy, which is currently the subject of much discussion. In my view, the situation is straightforward. The key release is Nonfarm Payrolls, while the unemployment rate will provide an adjustment. Thus, whether the Fed will decide to raise its interest rate at least through the end of the year will depend on whether August payrolls come in above 58,000. In recent weeks, the dollar has managed to strengthen largely on the market's hawkish expectations. If these expectations disappear, bears could weaken the dollar very quickly.

I would also like to highlight several very important factors that indirectly point to a neutral FOMC decision in September. First, there is the labor market, which has already been discussed extensively. In my view, the reports released in recent months simply do not allow the FOMC to make a decision to raise rates. Second, there is inflation, which has declined over the past two months. Whether it will accelerate in August remains unknown. Without an increase in inflation, however, the Fed has no need to tighten monetary policy. Third, there is the committee's actual policy stance. At the previous meeting, only a few policymakers voted in favor of tighter policy, even though inflation was significantly higher at the time than it is now.

Fourth, New York Fed President John Williams said recently that the disinflation process in the United States is continuing, as the impact of import tariffs on the economy is declining. Energy costs are indeed high, but they are not spilling over into other categories of goods and services. Williams also said that the Fed's current interest rate is fully consistent with the prevailing economic and geopolitical conditions and allows the Fed to maintain a balance between its dual mandate of maximum employment and price stability. Other policymakers may, of course, hold a different view, but in my opinion, the economic reality is such that the FOMC's September decision will be clear-cut and unanimous. The market has been cautiously buying dollars in recent weeks, but as early as tomorrow and throughout September, it may become disappointed with the market's commitment to a hawkish stance several times.

Economic Calendar for the United States, the European Union, and the United Kingdom:

• European Union – Change in retail sales (09:00 UTC).
• United States – Change in Nonfarm Payrolls (12:30 UTC).
• United States – Unemployment rate (12:30 UTC).
• United States – Change in average hourly earnings (12:30 UTC).

EUR/USD Forecast and Trading Tips:

In my view, the pair remains in the process of forming a bullish trend that paused for an entire year. The fundamental backdrop shifted sharply in favor of the bears six months ago, but the trend itself cannot be considered canceled or complete. From a long-term perspective, I would say that the pair is trading in a range. However, the range does not invalidate the broader bullish trend. Therefore, the bulls may well resume their advance after two liquidity sweeps of clearly defined lows. At present, bullish traders have an excellent support zone in the form of imbalance 20, where a new bullish signal may form. We have already seen a precise rebound from imbalance 21. I consider 1.1797 and 1.1850 to be the targets for a new advance in the euro.

GBP/USD Forecast and Trading Tips:

The long-term outlook for the pound remains bullish. After liquidity sweeps of the two most recent swings and the formation of a series of buy signals, the bulls may still resume their advance. Unfortunately, the bears have controlled the initiative over the past week, and all recent bullish patterns have been invalidated. The bears currently have technical grounds to push the pair lower. Only the euro may be able to save the pound. The liquidity sweep of the May 1 swing triggered the decline, and a sell signal formed inside inverted imbalance 27. It is difficult to say how long the pound will continue to fall. Two bullish imbalances on EUR/USD could potentially stop the decline. On Friday, the United States will release important labor-market and unemployment reports.

During the US trading session on September 2, crude oil managed to close the gap it had left on July 23 around $89.75. This gap has now been closed, and the market is likely showing signs of exhaustion; we could expect a technical trend reversal in the coming hours.

If crude oil continues to rise, we could expect it to encounter resistance around the 7/8 Murray level at $93.75; below this zone, a pullback could occur, which would be considered a selling opportunity.

Conversely, if crude oil falls below the Murray 6/8 level and below the 21-period simple moving average (SMA), we could expect a sharp decline, during which the price could reach the 200-period exponential moving average (EMA) around $82.78 and, ultimately, find strong support around the Murray 5/8 level, at $81.25.

Since crude oil is trading near the psychological $90 level, we could look for opportunities to sell below $90.76; the first target could then be $87.71 and, ultimately, $82.78.

The EUR/USD pair is trading around 1.1623, after rebounding from the 200-period exponential moving average (EMA) around 1.1565; this level provided the euro with strong upward momentum.

From a technical perspective, the euro could reach the 61.8% Fibonacci retracement level around 1.1657. This point could be considered an opportunity to open short positions.

If the price falls below the 38.2% Fibonacci retracement level, which is near current levels, and a technical correction occurs below 1.1623 in the coming hours, we could sell, expecting the instrument to find strong support around the Murray 6/8 level and the 21-period simple moving average (SMA), near 1.1596.

The outlook for the euro remains bullish, and a pullback toward the Murray 6/8 level via the 200-period exponential moving average (EMA) could be viewed as an opportunity to re-enter long positions.

If the euro breaks above the 61.8% Fibonacci level, it could quickly reach the Murray 8/8 level around 1.1718.

The Eagle indicator shows a bullish signal, and any pullback—provided EUR/USD settles above the 200-period exponential moving average (EMA)—could be considered an opportunity to continue buying.

Bitcoin is trading around $79,096 on an uptrend after breaking above the 5/8 Murray level. BTC has been trading below this zone during recent sessions under downward pressure.

Given that BTC is now trading above the 21 SMA and above the 5/8 Murray level, the outlook suggests it could continue rising until it reaches the psychological level of $80,000. If the upward momentum persists and it even reaches the 6/8 Murray level around $81,250, this level could, in turn, form a double top pattern if the instrument encounters strong resistance.

Looking at the H4 chart, Bitcoin reached $81,250 on August 26. If Bitcoin reaches this zone again in the coming hours and consolidates below it, we could view this as an opportunity to open short positions.

At current price levels above $78,125, we can continue buying Bitcoin; a pullback toward this zone or a technical rebound will be seen as a positive signal.

The Eagle indicator is showing a bullish signal, and we believe this zone will be a good point to buy above 5/8; we should also keep an eye on the 6/8 resistance zone to open short positions.

Gold is trading around $4,473 with a bullish bias, and we could expect it to continue rising over the next few hours until it reaches the 61.8% Fibonacci level around $4,535, or it could encounter strong resistance around the 6/8 Murray level at $4,531.

Since the opening of Thursday's Asian session, gold has been rising, and this could be seen as an opportunity to continue buying in the coming hours, as the instrument could reach the psychological level of $4,500. Even if it breaks above this zone, it could face strong resistance, so we must remain vigilant because a technical correction could occur.

Gold could come under downward pressure over the next few days if the price approaches the 6/8 Murray level. A move below this zone could be seen as a good opportunity to sell. If you, as a trader, are selling gold, you should be aware that the price could reach $4,531, and if it fails to break above this zone, it will be a good point to open short positions.

The outlook for the coming days is that gold will trade within a price range between the 6/8 Murray level and the 5/8 Murray level. Therefore, a move below the 61.8% Fibonacci level will be a strong bearish signal; hence, a move above the 23.6% Fibonacci level could be a signal to resume long positions.

The Eagle indicator is showing a bullish signal, so any pullback in gold over the next few days could be seen as a signal to continue buying. The target is $4,531, and if gold breaks above this level, it could reach the 8/8 Murray level around $4,687.

The escalation between the United States and Iran has turned the Strait of Hormuz into a "Schrodinger's strait." Maritime traffic has collapsed, pushing Brent crude above $95/barrel, yet the White House is broadcasting a sharply different narrative. US President Donald Trump insists that the waterway is under full control and that shipments remain at record levels. This information war has left markets deeply skeptical and unsure which version reflects reality.

Despite the geopolitical shock and higher energy prices, the US economy is showing surprising resilience. The Fed does not yet see an urgent need to raise interest rates, viewing the rise in government bond yields more as a sign of fundamental strength than as an inflationary crisis. While higher borrowing costs and fuel prices have hit auto and housing demand, industrial activity and data-center infrastructure investment are offsetting some of the drag. Follow the link for more details.

Dollar weakens on weak data and hidden split at Fed

The dollar eased noticeably yesterday, pressured by three factors: a disappointing ADP report, currency intervention by the Bank of Japan, and, most importantly, dovish comments from New York Fed President John Williams. He said US inflation continues to slow and that the tariff effect is fading. He argued the current policy rate in the 3.50%–3.75% range is already at an adequate restrictive level and that the Fed does not need to rush.

Williams's remarks highlighted a deep ideological split within the Federal Reserve. His stance directly contradicts recent comments from Fed Chair Kevin Warsh, who believes financial conditions are not restrictive and that the fight against inflation is far from over. That fundamental disagreement leaves markets in limbo, depriving the dollar of clear backing and forcing investors to speculate which view will prevail. Follow the link for more details.

Tug-of-war at Fed: key catalysts for USD and markets in September

Markets are frozen in anticipation of the Fed's September rate decision, and forecasts are almost evenly split. On one side, persistently high inflation and rising Treasury yields push the central bank toward tightening. On the other, troubling labor market signals and easing consumer inflation give the Fed a solid reason to pause. This uncertainty creates a tug?of?war dynamic in which each new economic data point can tip the scales one way or the other.

The key trigger will be the upcoming US nonfarm payrolls report. If job gains come in weaker than expected and prices show no surprises, the probability of a September rate hike, which has already fallen from 68% to 60.2% after weak ADP data, will fall further. In that scenario, markets would respond decisively: equities, gold, and cryptocurrencies would climb, while the dollar and US government yields would come under significant pressure. Follow the link for more details.

End of safe-haven era: forces behind USD weakness and EUR/USD gains

The EUR/USD pair has finally halted its long slide and moved to the offensive, with the Japanese yen emerging as an unexpected ally for euro bulls. The Bank of Japan has started to raise interest rates and trim its government bond purchases. Given the sheer size of Japan's financial markets, that move sparked a drop in global bond yields and a stronger yen — effects that have supported the euro via knock-on reactions.

A second, equally important reason for the reversal is the dollar's structural vulnerability. Large global investors are currently hedging currency exposure at the lowest levels since 2015, out of habit treating the dollar as a reliable safe haven. That strategy is beginning to crack: amid growing doubts about US authorities' willingness to defend the currency, the market is increasingly pricing for deliberate dollar debasement. If investor sentiment shifts sharply, the dollar could face a rapid sell-off. Follow the link for more details.

The test of the 157.83 price occurred when the MACD indicator had already moved significantly below the zero level, which limited the pair's downward potential. For this reason, I did not sell the dollar and missed a good downward move.

In the second half of the day, the market will be watching the U.S. services business activity index, the composite PMI, weekly jobless claims, and the foreign trade balance, as well as speeches by FOMC members Christopher Waller, Beth Hammack, and Austan Goolsbee. Jobless claims have gained particular importance following the weak labor market reports released earlier this week. Differences of opinion within the Federal Reserve could add further uncertainty to the market, as the positions of hawkish policymakers and those favoring a cautious approach differ significantly. All of this will affect the dollar through expectations for interest rates and U.S. Treasury yields.

For the yen, dollar dynamics remain important, but the actions of the Bank of Japan itself have moved to the forefront. The Bank continues to intervene, and the yen has continued to strengthen against this backdrop. Coordinated steps with the United States have given the intervention additional weight, and USD/JPY continued to decline during today's European session. Weak U.S. data could further strengthen this move, while strong U.S. statistics could slow it down, but reversing the market's current direction will be difficult as interventions continue.

As for the intraday strategy, I will focus more on implementing Scenarios No. 1 and No. 2.

Buy Signal

Scenario No. 1: Today, I plan to buy USD/JPY when the entry point is reached around 156.65 (the green line on the chart), with a target of 157.35 (the thicker green line on the chart). Around 157.35, I will exit the long position and open a short position in the opposite direction, targeting a move of 30–35 points in the opposite direction from the level. A rise in the pair can be expected today, but the upward potential is rather limited. Important! Before buying, make sure that the MACD indicator is above the zero level and is just starting to rise from it.

Scenario No. 2: I also plan to buy USD/JPY today if the price tests 156.18 twice consecutively while the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to a reversal of the market to the upside. A rise toward the opposite levels of 156.65 and 157.35 can be expected.

Sell Signal

Scenario No. 1: Today, I plan to sell USD/JPY after the 156.18 level is updated (the red line on the chart), which should lead to a rapid decline in the pair. The key target for sellers will be 155.50, where I will exit the short position and immediately open a long position in the opposite direction, targeting a move of 20–25 points in the opposite direction from the level. Downward pressure on the pair will return if the central bank intervenes. Important! Before selling, make sure that the MACD indicator is below the zero level and is just starting to decline from it.

Scenario No. 2: I also plan to sell USD/JPY today if the price tests 156.65 twice consecutively while the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a reversal of the market to the downside. A decline toward the opposite levels of 156.18 and 155.50 can be expected.

What Is on the Chart:

• Thin green line – the entry price at which the trading instrument can be bought;
• Thick green line – the projected price at which Take Profit orders can be placed or profit can be taken manually, as further growth above this level is unlikely;
• Thin red line – the entry price at which the trading instrument can be sold;
• Thick red line – the projected price at which Take Profit orders can be placed or profit can be taken manually, as further decline below this level is unlikely;
• MACD indicator. When entering the market, it is important to take the overbought and oversold zones into account.

Important. Beginner Forex traders should be very cautious when making market entry decisions. Before the release of important fundamental reports, it is best to stay out of the market to avoid being caught in sharp exchange-rate fluctuations. If you decide to trade during news releases, always place stop orders to minimize losses. Without stop orders, you can lose your entire deposit very quickly, especially if you do not use proper money management and trade large volumes.

And remember that successful trading requires a clear trading plan, such as the one presented above. Making trading decisions spontaneously based on the current market situation is an inherently losing strategy for an intraday trader.

The test of the 1.3497 price occurred when the MACD indicator was just starting to move upward from the zero level, confirming the validity of the entry point for buying the pound. As a result, the pair rose by only 10 points.

The August UK business activity report confirmed the continuation of the recovery, driven by the services sector. The sector accelerated to 52.5, its highest level in four months, while the composite index also rose to 52.5. At the same time, input-cost inflation turned upward after reaching a low in July, while services selling prices accelerated for the first time in four months. For the Bank of England, accelerating services prices are becoming a key signal, as they complicate efforts to bring inflation under control and support those favoring a tighter policy stance, while input costs in manufacturing, by contrast, slowed to their lowest level since February. For GBP/USD, this combination provides support from strong services activity and rising price pressures, but weakness in the labor market and the regulator's cautious approach are still preventing the bulls from establishing a sustained upward move.

In the second half of the day, the U.S. economic calendar will determine the pound's direction. The focus will be on the services business activity index, the composite PMI, weekly jobless claims, and the trade balance. Additional uncertainty will come from speeches by FOMC members Christopher Waller, Beth Hammack, and Austan Goolsbee, whose comments could further increase uncertainty and highlight divisions within the Federal Reserve. For GBP/USD, this means that weak data and dovish signals will support the British currency, while strong statistics and hawkish comments will strengthen the dollar.

As for the intraday strategy, I will focus more on implementing Scenarios No. 1 and No. 2.

Buy Signal

Scenario No. 1: Today, I plan to buy the pound when the entry point is reached around 1.3501 (the green line on the chart), with a target of 1.3523 (the thicker green line on the chart). Around 1.3523, I will exit the long position and open a short position in the opposite direction, targeting a move of 30–35 points in the opposite direction from the level. The pound can be expected to rise today only after weak U.S. data. Important! Before buying, make sure that the MACD indicator is above the zero level and is just starting to rise from it.

Scenario No. 2: I also plan to buy the pound today if the price tests 1.3485 twice consecutively while the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to a reversal of the market to the upside. A rise toward the opposite levels of 1.3501 and 1.3523 can be expected.

Sell Signal

Scenario No. 1: Today, I plan to sell the pound after the 1.3485 level is updated (the red line on the chart), which should lead to a rapid decline in the pair. The key target for sellers will be 1.3459, where I will exit the short position and immediately open a long position in the opposite direction, targeting a move of 20–25 points in the opposite direction from the level. Strong downward pressure on the pound will return if the data are strong. Important! Before selling, make sure that the MACD indicator is below the zero level and is just starting to decline from it.

Scenario No. 2: I also plan to sell the pound today if the price tests 1.3501 twice consecutively while the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a reversal of the market to the downside. A decline toward the opposite levels of 1.3485 and 1.3459 can be expected.

What Is on the Chart:

• Thin green line – the entry price at which the trading instrument can be bought;
• Thick green line – the projected price at which Take Profit orders can be placed or profit can be taken manually, as further growth above this level is unlikely;
• Thin red line – the entry price at which the trading instrument can be sold;
• Thick red line – the projected price at which Take Profit orders can be placed or profit can be taken manually, as further decline below this level is unlikely;
• MACD indicator. When entering the market, it is important to take the overbought and oversold zones into account.

Important. Beginner Forex traders should be very cautious when making market entry decisions. Before the release of important fundamental reports, it is best to stay out of the market to avoid being caught in sharp exchange-rate fluctuations. If you decide to trade during news releases, always place stop orders to minimize losses. Without stop orders, you can lose your entire deposit very quickly, especially if you do not use proper money management and trade large volumes.

And remember that successful trading requires a clear trading plan, such as the one presented above. Making trading decisions spontaneously based on the current market situation is an inherently losing strategy for an intraday trader.

The test of the 1.1603 price occurred when the MACD indicator was just starting to move upward from the zero level, confirming the validity of the entry point for buying the euro. As a result, the pair rose by only 10 points.

The August eurozone business activity report confirmed that the economy was consolidating at the levels already reached, but the single currency remained almost unresponsive to the data. The composite PMI held at 52.0, matching the July high, while services activity declined slightly to 51.6. Since both readings came in slightly below preliminary estimates and contained no surprise, there was virtually no reaction in EUR/USD, and the euro continued to focus on external factors. Nevertheless, the internal structure of the report was encouraging. Private-sector employment increased for the first time in a year, while new export orders rose for the first time in four and a half years amid a recovery in industrial activity. The picture across countries remained mixed, as growth was driven by Spain and Italy, Germany accelerated at the fastest pace since March, while France continued to contract for the eighth consecutive month.

In the second half of the day, the euro will remain focused on a busy U.S. economic calendar, which will include the services business activity index, the composite PMI, weekly jobless claims, and the foreign trade balance. The PMI figures will show whether the largest economy continues to maintain business activity and, in turn, will influence expectations for the Federal Reserve's interest rate. Additional volatility may come from speeches by FOMC members Christopher Waller, Beth Hammack, and Austan Goolsbee, whose comments could further highlight divisions within the regulator. Differences of opinion between hawkish policymakers and those favoring a cautious approach make the outlook more difficult, which means increased sensitivity for the single currency to every signal. Weak data combined with dovish rhetoric will support EUR/USD, while strong statistics and hawkish comments will restore the dollar's initiative.

As for the intraday strategy, I will focus more on implementing Scenarios No. 1 and No. 2.

Buy Signal

Scenario No. 1: Today, the euro can be bought when the price reaches around 1.1610 (the green line on the chart), with a target of 1.1632. At 1.1632, I plan to exit the market and also sell the euro in the opposite direction, targeting a move of 30–35 points from the entry point. The euro can be expected to rise today only after weak U.S. data. Important! Before buying, make sure that the MACD indicator is above the zero level and is just starting to rise from it.

Scenario No. 2: I also plan to buy the euro today if the price tests 1.1598 twice consecutively while the MACD indicator is in the oversold area. This will limit the pair's downward potential and lead to a reversal of the market to the upside. A rise toward the opposite levels of 1.1610 and 1.1632 can be expected.

Sell Signal

Scenario No. 1: I plan to sell the euro after the price reaches 1.1598 (the red line on the chart). The target will be 1.1580, where I plan to exit the market and immediately buy in the opposite direction, targeting a move of 20–25 points in the opposite direction from the level. Downward pressure on the pair will return if U.S. data are strong. Important! Before selling, make sure that the MACD indicator is below the zero level and is just starting to decline from it.

Scenario No. 2: I also plan to sell the euro today if the price tests 1.1610 twice consecutively while the MACD indicator is in the overbought area. This will limit the pair's upward potential and lead to a reversal of the market to the downside. A decline toward the opposite levels of 1.1598 and 1.1580 can be expected.

What Is on the Chart:

• Thin green line – the entry price at which the trading instrument can be bought;
• Thick green line – the projected price at which Take Profit orders can be placed or profit can be taken manually, as further growth above this level is unlikely;
• Thin red line – the entry price at which the trading instrument can be sold;
• Thick red line – the projected price at which Take Profit orders can be placed or profit can be taken manually, as further decline below this level is unlikely;
• MACD indicator. When entering the market, it is important to take the overbought and oversold zones into account.

Important. Beginner Forex traders should be very cautious when making market entry decisions. Before the release of important fundamental reports, it is best to stay out of the market to avoid being caught in sharp exchange-rate fluctuations. If you decide to trade during news releases, always place stop orders to minimize losses. Without stop orders, you can lose your entire deposit very quickly, especially if you do not use proper money management and trade large volumes.

And remember that successful trading requires a clear trading plan, such as the one presented above. Making trading decisions spontaneously based on the current market situation is an inherently losing strategy for an intraday trader.

GPIF portfolio dynamics and structure

The shift in sentiment coincided with an unexpected development: the steering committee of the world's largest pension fund, GPIF, with $2 trillion in assets, convened an unscheduled summer meeting for the first time in seven years. Formally, the agenda concerned asset allocation, though the committee had decided in March that no review was required. The market immediately suspected the fund might increase the target share of domestic bonds in its £318 trillion portfolio. Prime Minister Sanae Takaichi and Finance Minister Satsuki Katayama have long urged pension capital to return home.

The yen also got a more direct reason for optimism. Bank of Japan board member Hajime Takata said a 25?basis?point hike is "not set in stone" and did not rule out a larger step. Yen buying could have been reinforced by speculation of an outsized increase, Mizuho Bank notes. The futures market is now fully pricing a September rate hike and is pushing expectations toward a continuation of the cycle in December.

But there is a much less subtle voice behind the BOJ. US Treasury Secretary Scott Bessent has stepped up public pressure on Tokyo, demanding more decisive action. Washington's barely disguised appeals have turned the September meeting into a high?stakes game: any hesitation by the central bank would not merely surprise the market — it would send the yen tumbling.

JP Morgan Securities says that after Washington has said so much, it would be hard for the BOJ not to respond. Still, if the central bank appears unable to raise rates without external tailwinds, the effectiveness of its policy itself will be called into question.

USD/JPY movement and currency interventions

The price of such dependence is already known. Over the past month, Japan spent a record $96.4 billion defending the currency, and US support only underscored the warning to speculators betting against the yen. Manulife Investment Management says the market received a signal that authorities want a stronger yen.

Yet the force of outside pressure is a poor substitute for domestic resolve. Will the Bank of Japan be able to act on its own on Sept. 18, or will it again need a nudge from abroad?

Technically, on the daily chart, USD/JPY has returned to August's low with the risk of a renewed correction toward the long-term uptrend. While the dollar trades below £156.6, the bias is to sell.

According to the data, the private sector added only 38,000 jobs in August, versus a weak 47,000 consensus. July's figure was revised up slightly (from 44,000 to 46,000), but that adjustment does not change the overall picture: August's gain was the smallest since January. The spring hiring impulse appears to have run out of steam. ADP has shown sequential (and rather pronounced) deceleration for the third month in a row.

The weakness of the August release is particularly visible in its composition. The goods-producing sector—manufacturing and mining, construction, and agriculture—shed 10,000 jobs: manufacturing lost 17,000 and mining a further 5,000. The sole positive in that group was construction (+12,000).

Services looked better (+48,000), but that headline masks an uneven picture. Almost all the gain came from education and health (+45,000) and hospitality (+16,000). Professional and business services cut payrolls by 16,000; trade, transport, and utilities lost 5,000; and information shed 4,000.

In short, the problem is not just a weak headline number. The problem is that the engines of job creation are becoming ever narrower. Virtually the entire private sector increase was driven by education and health, while cyclical sectors continued to shed jobs.

The firm-size breakdown is also striking. Small firms created only 3,000 jobs, medium firms created none, while large employers added 34,000. Nearly 90% of August's payroll gain came from firms with 500 or more employees—hardly a sign of broad-based, multi-layered, sustainable hiring.

There is more. Wages also showed disappointing dynamics. Core wages rose only 3.2% year-on-year, and for employees who did not change jobs the increase was 3.0%. For those who changed employers, the rate was 4.7%. Annual pay growth for job-switchers slowed to 7.3% from 7.5% a month earlier.

All of this points to a labor market showing both weak hiring and cooling wage pressure.

Of course, one should not mechanically map ADP onto the official non-farm payrolls (NFP) for August. The two reports use different methodologies, and ADP covers only the private sector. While the long-run correlation between the two series is high (roughly 94–95%), month-to-month divergence can be substantial. A weak ADP is therefore not a guarantee of weak NFP.

Yet in the current context the ADP signal is concerning, particularly alongside other signs of labor market softening.

The day before, the JOLTS report painted a mixed picture that also weighed on the dollar. Job openings rose by 89,000 in July to 7.271 million, but June was revised down sharply by 177,000 to 7.182 million. New hires fell roughly 278,000 to 5.054 million, and the hiring rate dropped to 3.2% from 3.4%. Layoffs did decline—from 1.785 million to 1.666 million—which superficially looks constructive. But viewed together with other indicators, the JOLTS data point to a labor market in which firms are reluctant to fire but also unwilling to hire aggressively: the classic "low-hire, low-fire" scenario that signals stagnation more than acceleration.

In short, ADP and JOLTS tell the same story: US companies are not expanding payrolls rapidly, and the weakness shows mainly through slower hiring rather than through a wave of layoffs. That nuance matters.

The "red tone" of ADP and JOLTS ahead of Friday's NFP does not bode well for the dollar—especially given modest consensus expectations (consensus forecasters expect 58,000 new jobs after a 23,000 decline in the prior month). The mix of weak ADP, falling hiring rates in JOLTS, and deterioration in cyclical sectors raises the odds that the official release will disappoint.

If NFP does print weak, the balance of risks facing the Fed will shift materially toward cooler labor market conditions and a slowing economy. That matters for Kevin Warsh's stance after Jackson Hole. On the one hand, Warsh emphasized persistent inflation risks and the possible need for further tightening. On the other hand, he repeatedly stressed that future decisions will be data-dependent.

That is why a softer labor market can act as a counterbalance to elevated inflation. If Friday's report confirms a sustained slowdown in hiring, traders will have reason to doubt the case for additional tightening. Even with inflation pressures present, the Fed must weigh its dual mandate—and a weaker NFP would be dollar-negative. The weaker the NFP, the more the market will price a more cautious Fed.

Therefore, in my view EUR/USD still has upside potential—at least toward the 1.1610–1.1650 range (the middle Bollinger Band/Tenkan-sen on D1). Sellers failed to press below 1.1580 (the lower Bollinger Band on the 4-hour chart), and buyers have taken the initiative. If NFP comes in substantially below expectations, EUR/USD may stage a northern breakout and retest the 1.17 figure—but that would be another story.

On-chain data show that approximately 880,000 bitcoins currently have an average purchase price in the $77,500–$80,300 range, meaning that a significant group of holders owns the asset at nearly the same price at which they initially acquired it.

With Bitcoin currently trading around $77,000–$77,700, this zone effectively coincides with the market price rather than being far into profit or loss, as is usually the case for most holders during a pronounced trend. Such a concentration creates a psychologically sensitive area on the chart, where holders' sentiment can shift sharply from calm to concern and back again following relatively small price movements.

The scale of this concentration has tangible practical implications. Even minor price fluctuations can move tens of billions of dollars worth of Bitcoin between profit and loss, potentially releasing supply from investors who have been in a loss position for months and can now exit at breakeven or a small profit. Historically, such cost-basis concentration zones become areas of heightened volatility because holders' psychology changes sharply around the breakeven point. After a long period of waiting, the desire to lock in at least some return often outweighs the willingness to continue holding the position in anticipation of higher profits.

So far, the market has absorbed this selling pressure, with some of the potential supply being absorbed by large buyers, including corporate crypto treasuries such as Strategy, which has resumed active Bitcoin purchases in recent weeks precisely at these levels. However, how long such demand can neutralize the growing number of holders willing to sell as the price approaches breakeven remains an open question.

If selling pressure begins to increase faster than institutional buyers are willing to absorb it, the $77,500–$80,300 level could turn from an area of relative equilibrium into a zone that determines the market's next direction: upward in the event of a sustained breakout, or downward if the number of holders seeking to lock in at least a breakeven result exceeds the number of buyers on the other side of the trade.

Bitcoin

Buying Scenario

Scenario #1: Today, I will buy Bitcoin when the entry point is reached around $77,900, with a target of $78,600. Around $78,600, I will close the long position and immediately look to sell on a rebound. Before buying on a breakout, make sure that the 50-day moving average is below the current price and that the Awesome Oscillator is above zero.

Scenario #2: Bitcoin can be bought from the lower boundary at $77,300 if there is no market reaction to a breakout below this level, with a return toward $77,900 and $78,600.

Selling Scenario

Scenario #1: Today, I will sell Bitcoin when the entry point is reached around $77,300, with a target of $76,500. Around $76,500, I will close the short position and immediately look to buy on a rebound. Before selling on a breakout, make sure that the 50-day moving average is above the current price and that the Awesome Oscillator is below zero.

Scenario #2: Bitcoin can be sold from the upper boundary at $77,900 if there is no market reaction to a breakout above this level, with a return toward $77,300 and $76,500.

Ethereum

Buying Scenario

Scenario #1: Today, I will buy Ether when the entry point is reached around $2,398, with a target of $2,423. Around $2,423, I will close the long position and immediately look to sell on a rebound. Before buying on a breakout, make sure that the 50-day moving average is below the current price and that the Awesome Oscillator is above zero.

Scenario #2: Ether can be bought from the lower boundary at $2,382 if there is no market reaction to a breakout below this level, with a return toward $2,398 and $2,423.

Selling Scenario

Scenario #1: Today, I will sell Ether when the entry point is reached around $2,382, with a target of $2,359. Around $2,359, I will close the short position and immediately look to buy on a rebound. Before selling on a breakout, make sure that the 50-day moving average is above the current price and that the Awesome Oscillator is below zero.

Scenario #2: Ether can be sold from the upper boundary at $2,398 if there is no market reaction to a breakout above this level, with a return toward $2,382 and $2,359.

The data showed that the eurozone economy performed reasonably well in August. The composite PMI came in at 52.0, exactly matching July's eight-month high, while services edged down to 51.6 from 51.7. Business activity indices are based on company surveys and reflect the state of the economy, with a reading above 50 indicating growth. However, both figures came in slightly below preliminary estimates and remain below the long-term average of 52.3. Therefore, there was no surprise for the market, and EUR/USD remained driven by external factors.

For the ECB, however, something else is more important, as the disinflationary process that had been underway since the May peak has stalled, while input costs and output prices in the services sector accelerated to three-month highs. S&P Global explicitly noted that the central bank may consider tighter policy at the meeting to be justified. The meeting will take place in Berlin on September 10, and the market is almost fully pricing in a 25-basis-point rate hike to 2.5%. This remains a supportive factor for the euro, despite its muted reaction to the report itself.

As for the pound, Britain's services sector accelerated to 52.5 in August from 52.1, reaching a four-month high, while the composite index rose to 52.5 from 52.2. GBP/USD responded with an increase. Nevertheless, the report had two problems. The first concerns employment, which has been declining in the services sector for 23 consecutive months. The second problem is more important for the Bank of England, as input cost inflation turned higher after reaching a five-month low in July, while output prices in the services sector accelerated for the first time in four months. This creates a mixed backdrop for GBP/USD: stronger services activity and increasing price pressures support the case for a hawkish policy stance, but a weak labor market limits the upside potential of the British currency.

The second half of the day promises to be busy, as in addition to the US services business activity index and composite PMI, weekly initial jobless claims and the foreign trade balance will be released. PMI indices reflect the state of business activity, with the 50-point mark separating growth from contraction, while jobless claims serve as a timely indicator of labor-market conditions, which is particularly important following yesterday's weak ADP report and ahead of Friday's official employment report. The trade balance will add to the overall picture, although it is a secondary short-term driver.

The speeches by FOMC members Christopher Waller, Beth Hammack, and Austan Goolsbee deserve particular attention, as their comments could add to the confusion and highlight divisions within the Fed. Recall that Hammack was previously among the policymakers who favored a rate hike, while the positions of other members differ. Therefore, the divergence of views could add uncertainty to the market.

If the economic data are strong, I will rely on the Momentum strategy. If the market does not react to the data, I will continue to use the Mean Reversion strategy.

Momentum Strategy (breakout) for the second half of the day:

For EURUSD

• Buying on a breakout above 1.1623 could lead to a rise in the euro toward 1.1641 and 1.1657.
• Selling on a breakout below 1.1601 could lead to a decline in the euro toward 1.1584 and 1.1568.

For GBPUSD

• Buying on a breakout above 1.3505 could lead to a rise in the pound toward 1.3527 and 1.3550.
• Selling on a breakout below 1.3480 could lead to a decline in the pound toward 1.3457 and 1.3435.

For USDJPY

• Buying on a breakout above 156.73 could lead to a rise in the dollar toward 157.05 and 157.40.
• Selling on a breakout below 156.13 could lead to a decline in the dollar toward 155.96 and 155.56.

Mean Reversion Strategy (return) for the second half of the day:

For EURUSD

• I will look for selling opportunities after a failed break above 1.1617, followed by a return below this level.
• I will look for buying opportunities after a failed break below 1.1592, followed by a return to this level.

For GBPUSD

• I will look for selling opportunities after a failed break above 1.3510, followed by a return below this level.
• I will look for buying opportunities after a failed break below 1.3479, followed by a return to this level.

For AUDUSD

• I will look for selling opportunities after a failed break above 0.7196, followed by a return below this level.
• I will look for buying opportunities after a failed break below 0.7171, followed by a return to this level.

For USDCAD

• I will look for selling opportunities after a failed break above 1.3824, followed by a return below this level.
• I will look for buying opportunities after a failed break below 1.3795, followed by a return to this level.

Williams said yesterday there is evidence that inflation is continuing to ease as the effects of tariffs fade and higher energy costs are not spreading to other services. "The data lately is encouraging," he said in a Wednesday interview, adding, "I do really see the inflation trend moving down slowly as some of the tariff effects move into the rearview mirror."

Williams's assessment of current policy is noticeably more sanguine than that of the hawkish wing. He supported the decision to leave rates unchanged at the July meeting and considers the current level appropriate. "Following the last FOMC meeting, interest rates are in a good place" to balance the dual mandate of full employment and price stability, he said, adding: "We're gathering a lot of data now, and we'll have to reassess that judgment."

That stance contrasts sharply with the chair's. Recall that Kevin Warsh said at Jackson Hole that he would find it hard to describe broad financial conditions as restrictive and stressed that policymakers "have work to do" if they are not confident core inflation is moving to target. Williams, by contrast, explicitly calls the current rate level appropriate, while acknowledging that tariffs and energy driven up by the Middle East conflict remain the primary inflation drivers and that elevated inflation in services still exerts some influence.

The specifics of his assessments are notable because they frame the entire dispute within the Fed. "I would expect that if we saw a sustained boom in productivity of the sort we have seen before, that would push the neutral rate up. But I have to say, right now we have not seen that," he said, estimating the neutral rate at roughly 1%. In his view, the real policy rate has risen only modestly. On that basis, a current range of 3.50–3.75% with inflation around 3.7% implies policy is already in restrictive territory — a conclusion that directly contradicts Warsh's.

Differences over how restrictive policy is were also apparent at the Jackson Hole symposium itself. Fed officials will reconvene September 15–16 in Washington after five consecutive meetings of unchanged policy; at the July meeting, three voting members dissented in favor of a quarter-point rate hike. With the market now pricing roughly a 70% chance of a September hike after Warsh's speech, and with an influential voice like Williams leaning toward the status quo, the upcoming meeting risks becoming the most contentious in months.

On the technical front for EUR/USD, buyers now need to take 1.1608 to open a path toward testing 1.1623. From there, the instrument can target 1.1641, although doing so without support from large players will be difficult. On the downside, I expect serious buying only around 1.1584; if no buyers appear there, it would be prudent to wait for a new low at 1.1568 or to open longs from 1.1550.

For GBP/USD, pound buyers need to capture nearby resistance at 1.3494 to target 1.3515, above which further gains will be challenging. A more distant target is 1.3531. If the currency pair falls, bears will attempt to take control of 1.3475; a breach of that range would severely damage bull positions and push GBP/USD toward a low of 1.3457, with a prospect of reaching 1.3435.

Useful links:

My other articles are available in this section

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Popular Analytics

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Important:

The begginers in forex trading need to be very careful when making decisions about entering the market. Before the release of important reports, it is best to stay out of the market to avoid being caught in sharp market fluctuations due to increased volatility. If you decide to trade during the news release, then always place stop orders to minimize losses.

Without placing stop orders, you can very quickly lose your entire deposit, especially if you do not use money management and trade large volumes. For successful trading, you need to have a clear trading plan and stay focues and disciplined. Spontaneous trading decision based on the current market situation is an inherently losing strategy for a scalper or daytrader.

#instaforex #analysis #sebastianseliga

Useful links:

My other articles are available in this section

InstaForex course for beginners

Popular Analytics

Open trading account

Important:

The begginers in forex trading need to be very careful when making decisions about entering the market. Before the release of important reports, it is best to stay out of the market to avoid being caught in sharp market fluctuations due to increased volatility. If you decide to trade during the news release, then always place stop orders to minimize losses.

Without placing stop orders, you can very quickly lose your entire deposit, especially if you do not use money management and trade large volumes. For successful trading, you need to have a clear trading plan and stay focues and disciplined. Spontaneous trading decision based on the current market situation is an inherently losing strategy for a scalper or daytrader.

#instaforex #analysis #sebastianseliga