You are here: Home > articles > Forex > EUR/USD. Analysis for February 26. The recession in Germany has begun
EUR/USD. Analysis for February 26. The recession in Germany has begun
February 26, 2023 3:22 pmVideo
Latest News
- Analysis of GBP/USD pair on May 28, 2024 May 28, 2024
- EUR/USD: What could stop the growth of the euro? A hypothesis May 28, 2024
- Inflation expectations in eurozone downgraded May 28, 2024
- Trading Signals for BITCOIN (BTC/USD) for May 28-30, 2024: sell below $69,000 (21 SMA – 200 EMA) May 28, 2024
- Technical Analysis – EURUSD sets sight on 1.0900 handle May 28, 2024
- GBP/USD: Simple trading tips for novice traders on May 28th (US Session) May 28, 2024
- EUR/USD: Simple trading tips for novice traders on May 28th (US session) May 28, 2024
- GBP/USD: trading plan for the US session on May 28th (analysis of morning deals). The pound hit a new monthly high May 28, 2024
- EUR/USD: trading plan for the US session on May 28th (analysis of morning deals) May 28, 2024
- USD/JPY: trading tips for beginners for European session on May 28 May 28, 2024
- Forex forecast 05/28/2024: EUR/USD, USD/JPY, Gold, Ethereum and Bitcoin from Sebastian Seliga May 28, 2024
- EUR/USD. May 28th. The bulls intend to reach the level of 1.1000 May 28, 2024
- Trading plan for EUR/USD on May 28. Simple tips for beginners May 28, 2024
- GBP/USD. May 28th. The pound sees no reason to stop at its current level May 28, 2024
- USD/JPY: Simple trading tips for novice traders on May 28th. Analysis of yesterday’s forex transactions May 28, 2024
- Video market update for May 28, 2024 May 28, 2024
- GBP/USD: Simple trading tips for novice traders on May 28th. Analysis of yesterday’s forex transactions May 28, 2024
- EUR/USD: Simple trading tips for novice traders on May 28th. Analysis of yesterday’s forex transactions May 28, 2024
- Low volatility across the board besides Bitcoin – Volatility Watch May 28, 2024
- Technical Analysis – EURCHF pulls back from 14-month peak May 28, 2024
The 4-hour chart for the euro/dollar pair still shows the same wave pattern, which is excellent because it allows us to predict how the situation will develop. Although its amplitude would be more appropriate for the impulsive section, the upward section of the trend has been corrected. The wave pattern a-b-c-d-e that we were able to obtain features a wave e that is far more complex than the other waves. If the wave analysis is accurate, then this pattern’s development is complete, and wave e was far longer than any other wave. I still anticipate a significant decrease in the pair because we are expected to develop at least three waves downward. The demand for the euro currency was persistently high throughout the first few weeks of 2023, and during this time the pair was only able to deviate marginally from previously reached peaks. The US currency did, however, manage to escape market pressure at the beginning of February, and the present detachment of quotes from the peaks reached can be viewed as the start of a new downward trend section, which I was simply hoping for. I hope that the current news situation and market sentiment will not impede the formation of a downward series of waves this time.
The European economy is beginning to show signs of a recession.
On Friday, the euro/dollar pair fell by a further 50 basis points. The pair has been losing value for a while now, but the value of the euro is slowly declining rather than collapsing. By 20 points, 30 points, or even a few more points at times. Yet, the movement is steady and fully corresponds to the wave analysis for the moment. Let me remind you that the strength of the downward trend’s third wave depends on the strength of the downward trend’s first wave. As a result, there is a strong likelihood that the European currency will reach parity again in the upcoming months.
Germany published a report on GDP for the final value of the fourth quarter on Friday. Against market expectations for a 0.2% decline, the GDP contracted by 0.4%. Because there was no decline in the previous quarter (the third), the fourth quarter was the first in which the German economy declined rather than grew. Given how much has been discussed recently, I believe that a recession is just getting started. The German economy is the strongest in the European Union, and it sets the tone for the rest of the country. To a certain, the European economy will start to contract as well, but the recession may only be mild and short-lived. The losses in the EU may be even fewer, even though it is not anticipated that the UK’s GDP will decline by more than 1% overall. But, the US economy is not suffering at the same time; on the contrary, it is growing. Also, the Fed’s stance on monetary policy is constantly tightening. Hence, in my opinion, the news context perfectly supports the rise in demand for the US dollar. As a result, the pair can keep falling. If this is the case, then the 38.2% and 50.0% Fibonacci levels will be reached next week.
Conclusions in general
I draw the conclusion that the upward trend section’s development is finished based on the analysis. As a result, it is now allowed to take into account sales with targets close to the predicted mark of 1.0284, or 50.0% Fibonacci. Although there is still a chance that the upward trend section will become even more complicated, the chart currently shows what might be the start of a new downward trend segment.
On the older wave scale, the ascending trend section’s wave pattern has grown longer but is likely finished. The a-b-c-d-e pattern is most likely represented by the five upward waves we observed. The downward trend’s development has already started, and it might have any size or structure.
The material has been provided by InstaForex Company – www.instaforex.com
Related Posts: