On the H4 chart, the wave pattern still does not require any clarifications and additions, since the recent movement is quite weak, and the direction does not change. There is a continuous high and stable demand for the Euro currency, which allows the instrument to continue constructing an upward wave. A successful attempt to break through the 38.2% Fibonacci level led to the fact that the expected first wave extended. There are still no 5 waves visible inside it, so it can take on almost any length due to elongations in the third internal waves. Nevertheless, I still expect its completion in the near future and the departure of quotes from the reached highs as part of the construction of the second wave of a new upward trend. The beginning of the construction of this wave was expected to begin on the evening of Thursday. After all, the Fed meeting and its results are an important event, but after it ended, the demand for the US dollar declined even more, which ensured the continuation of the increase in the quotes of the instrument.
During the previous review, the markets were believed not expecting anything concrete from Jerome Powell and the Fed. Perhaps, only a few economists expected to hear that the QE program, which does not provide $ 120 billion in bond purchases every month, will begin to decline. But as expected, the Fed Chairman did not reveal when the regulator was going to end this program, but instead, talked throughout the press conference that the US economy has not yet fully recovered and will need stimulation until the employment rate rises to maximum. Inflation will not be stable at 2%, and the economy will not perform well over a long period of time. Thus, Powell's rhetoric can be called fairly "dovish" again. On one hand, he noted the high rates of recovery, while on the other, he noted that risks to the economy remain high, and a full recovery is still far away. Therefore, the Fed will definitely not end the QE program in the next few months. It is difficult to say whether the markets were disappointed by such words, but judging by the decline in demand for the US dollar, they were. The national currency lost about 70 basis points on Thursday evening. However, there was no point in expecting anything else. Now, the US has already released reports on GDP for the first quarter and on applications for unemployment benefits. It turned out that GDP rose by 6.4%, which is generally in line with forecasts, and the number of new applications for benefits was 553 thousand, which is also in line with market expectations. Thus, there was no surprise, and the market did not react to this data at all.
According to the analysis, an upward trend is still likely to form. Despite the fact the very successful attempt to break through the 38.2% Fibonacci level, we are still hoping for the formation of a second wave. Therefore, it is not suggested to open new purchases right away. It is better to wait until wave 2 or b is done.
The wave pattern of the section of the upward trend is still quite a complete five-wave form and is not going to get complex yet. But the section of the trend, which started to form immediately after it, takes on a corrective, but quite understandable form. This part of the trend is also almost done.
