18.07.202500:26 Forex Analysis & Reviews: Farce, Absurdity, and a Drama Series

Since Donald Trump continues his attempts to remove Jerome Powell from the position of FOMC Chair, it's worth taking a closer look at this topic. All recent news is well known to market participants and my readers. Everyone is aware that Trump is already prepared to appoint a new head of the Federal Reserve (almost a year before Powell's term expires) and is ready to accuse Powell of fraud. But is this story even worth a "plugged nickel"?

In my opinion, no. If Powell were susceptible to provocation, he would have long since stepped down, perhaps citing health reasons. I'm sure Trump himself would gladly help him "exit with dignity." However, Powell has proven to be a man of integrity and continues to carry out his duties, ignoring the attacks from the U.S. president. Interestingly, only Trump and his close allies are criticizing Powell, not Congress, for example. Just a month ago, the Fed Chair testified before Congress twice, and if lawmakers had any issues with his work, I'm confident they would have raised them.

Therefore, Trump has launched a "witch hunt," a term he likes to use whenever it's time to impose tariffs, sanctions, or "cleanse" his image. Undoubtedly, this story isn't over. I have little doubt that if Powell doesn't step down now, next week there will be reports of three unaccounted-for dollars in his bank account, leading to accusations of tax evasion or illicit profits. Or perhaps claims of stock trading (which is prohibited for the head of an institution that can influence the markets). The U.S. president will continue doing everything possible to make Powell resign voluntarily. Each attempt, along with its corresponding media statement, will be accompanied by a decline in the value of the U.S. dollar.

Thus, the farce and absurdity will continue — as will the entire drama series. Trump himself claims he won't fire Powell because he doesn't want to shock the markets. However, his actions suggest the opposite, though in any case he doesn't have the legal power to directly fire Powell.

EUR/USD Wave Structure:

Based on the conducted EUR/USD analysis, I conclude that the instrument is continuing to build an upward trend segment. The wave pattern still heavily depends on the news backdrop, particularly Trump's decisions and U.S. foreign policy, and there are still no positive developments. The targets of this trend segment may extend up to the 1.25 area. Therefore, I continue to consider long positions with targets around 1.1875 (which corresponds to the 161.8% Fibonacci level) and higher. In the near term, a corrective wave set is expected to form, so new euro purchases should follow the completion of this corrective structure.

GBP/USD Wave Structure:

The wave structure of GBP/USD remains unchanged. We are dealing with an upward, impulsive trend segment. Under Donald Trump, the markets may still experience many shocks and reversals, which could significantly impact the wave structure. However, at this point, the working scenario remains intact. The targets for the upward trend segment are now located around 1.4017, which corresponds to the 261.8% Fibonacci level from the presumed global wave 2. Currently, a corrective wave set is still forming. According to classical wave theory, it should consist of three waves.

Core Principles of My Analysis:

1. Wave structures should be simple and clear. Complex structures are hard to interpret and are often subject to change.
2. If you're not confident in what's happening in the market, it's better not to enter.
3. Absolute certainty in market direction doesn't exist and never will. Don't forget about protective Stop Loss orders.
4. Wave analysis can be combined with other forms of analysis and trading strategies.