The wave pattern of the upward trend has taken a completed five-wave form. Thus, the current wave marking implies the construction of a new downward trend section. If so, the pair may decline to the levels around the 19th and 18th mark. However, it should be recalled that in recent months, demand for the US dollar has been extremely low, so the upward trend may well continue and become more complicated.

The wave pattern in the smaller time frame also indicates that the section of the upward is completed. The estimated wave 5 in 5 is finished. If it breaks the low of wave 4, it may form a three-wave downward trend. So far, everything looks like the beginning of a new section of the trend. In this case, the pair is expected to further decline.

However, there are several factors that can prevent the quotes from falling. First, you should not forget that the demand for the US dollar has been extremely low recently. It has been mostly declining since the coronavirus pandemic started, which is not only happening when paired with the euro. Second, and most importantly, America will have a change of power today. There will be a Democratic president instead of a Republican one, and the Senate and the Lower House of Congress will now be controlled by Democrats. Thus, the currency exchange rate and monetary policies may change. For example, future US Treasury Secretary Janet Yellen, who previously served as Fed Chairman, has already said that she is not going to artificially influence the dollar. If under the Trump administration, everything was done to lower the rate, then under the Biden administration, the market will determine the rate. The results of this approach will be seen later.

One thing is for sure: The US dollar is declining and it may continue to do so, despite the wave pattern which implies the construction of a new downward trend channel. Nothing prevents the pair from building a three-wave correction pattern and moving on building a new upward trend. Further, much will also depend on the relationship between China and the United States. Janet Yellen has also said that Washington's attitude towards Beijing will not change dramatically. That is, a truce should not be expected to be established between these two in the near future, and all trade duties will be canceled. All this will affect both the dollar and the yuan. The package of financial assistance to Americans, which involves payments of $ 2,000, as well as support for small and medium-sized businesses, will also be very important. According to Yellen, the speed of the economic recovery will depend on the adoption of this package.

Overall conclusion and recommendations:

The EUR/USD pair presumably completed the formation of an upward trend section. Thus, it is now suggested to sell the pair with targets located near the 20th and 19th mark for each new downside signal of the MACD indicator. However, it is unreasonable to wait for the continuation of the construction of the upward section after three downward waves, which can already be built.