And here's where it gets most interesting. If you remember, I repeatedly said last year that the truce between China and the US is very fragile. In this matter, one should be guided by Donald Trump's policy, not by any agreements and deals. The US president showed throughout 2025 that tariffs are a means of putting pressure on an opponent and a way to fill the US treasury. It was also clear that a trade deal absolutely does not guarantee the absence of new tariffs tomorrow for other reasons.

In short, Trump finds pretexts for a trade war while simultaneously extracting benefits for the United States. On Tuesday, he announced tariffs for any country that trades with Iran. The American president again wants to kill two birds with one stone. First, to cut off financial inflows to Iran and support Iranian protesters to effect a government overthrow (which is also in Trump's interest). Second — to obtain additional money for the US budget.

But there is one problem. Iran sells most of its oil to China. So if Trump's words are not empty rhetoric, tariffs on China will be raised to 25%. That means a new trade war between the US and China, or an escalation of the old one, could erupt in 2026 — despite the trade truce reached last year.

Trump himself said that his decree is final and irreversible, and this is yet another event this week that the market ignored. Certainly, the US president could change his mind tomorrow or make exceptions. But even so, a new tariff increase is a significant event. I remind you that for most of 2025, the dollar depreciated because of the trade war.

China reacted to Trump's new decree the same way it reacted to all previous ones — "China will continue to protect its interests and opposes any illegal sanctions that violate the principles of free trade." However, I have no doubt that if new tariffs are introduced, Beijing's response will not be long in coming. Then the escalation of the trade war will be official.

Given all the above, I still do not understand what reasons could prompt market participants to increase demand for the dollar in 2026. In my view, the resumption of the uptrend in both instruments is only a matter of time.

Wave picture for EUR/USD:

Based on the analysis of EUR/USD, I conclude that the instrument continues to build an upward trend. Donald Trump's policy and the Fed's monetary policy remain significant factors for the long?term decline of the US currency. The targets of the current trend segment may extend to the 25th figure. The current upward wave set may be complete, so a decline is expected in the near future. The trend segment that began on November 5 may still take a five?wave form, but for now, it is, in any case, a corrective wave.

Wave picture for GBP/USD:

The wave picture of GBP/USD has changed. The downward corrective structure a?b?c?d?e in C of wave 4 appears complete, as does wave 4 as a whole. If this is indeed the case, I expect the main trend segment to resume construction, with initial targets around the 38 and 40 levels.

In the short term, I expected wave 3 or c to form, with targets near 1.3280 and 1.3360, which correspond to 76.4% and 61.8% of the Fibonacci. These targets have been reached. Wave 3 or C has presumably completed its construction, so in the near future, a downward wave or a set of waves may form.

The 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 can never be 100% confidence in the direction of movement. Do not forget protective Stop Loss orders.
4. Wave analysis can be combined with other types of analysis and trading strategies.