The wave counting of the 4-hour chart for the Euro/Dollar instrument, at the moment, looks quite clear and unambiguous and at the same time does not change at all over time. The instrument continues to move with a minimum amplitude. However, even the weakest movement sooner or later requires a certain interpretation. For example, now the last decline looks like a corrective wave as part of a new upward set of waves. And until the minimum of the last wave c is updated, the current wave count will remain in force. However, the stronger the corrective wave turns out, the more likely it is that the current section of the trend is not impulsive.
At the moment, the expected wave c and the entire downward section of the trend are considered completed. If this assumption is correct, then the price increase will resume with targets located near the 20th figure and the level of 1.2065, which corresponds to 50.0% and 38.2% Fibonacci. The final targets of the entire upward trend segment are located near the highs of the previous upward trend segment. However, given the current amplitude of the instrument, it can move to its targets within a few months. I am not considering the option of complicating the downward trend section yet.
The news background for the Euro/Dollar instrument is still completely absent on Friday. All the most important reports are scheduled for the second half of the day and will come from only one country – the United States. However, unlike yesterday, the markets have been moving the Euro/Dollar instrument quite actively since the morning, although no news has been released yet. What's this? Belief in strong nonfarm payrolls? Or just a downward movement, unrelated to anything? I tend to think that the first option is.
Forecasts suggest that the number of new jobs in July will be at least 900,000. Even if the actual value is less, it is still a lot. However, such a strong forecast can play a bad joke for the US dollar. After all, there is much more chance that the number of nonfarm will be below 900,000. About 1 million new jobs have been created only a few times in recent decades, and all these cases are immediately after the collapse of the second quarter of 2020. That is, a value of 900,000 is a lot.
Accordingly, if the actual value is lower, this may lead to a drop in demand for the US currency and a resumption of the increase in the instrument, which will fully correspond to the current wave count. I believe that this is the most likely option for today. The other reports of the day are less important.
Based on the analysis, I conclude that the construction of the downward wave c is completed. Thus, as I said earlier, it is now possible to buy the pair with targets located near the nearest Fibonacci levels. Such levels are 1.1919 and 1.1983, which corresponds to 61.8% and 50.0% Fibonacci. I recommend making purchases for each new MACD signal "up". If there are no surprises with the nonfarm report, then the price increase should resume today.
The wave counting of the higher scale looks quite convincing. We see three three-wave sections of the trend, which are approximately the same in size. This gives reason to assume that the last downward trend section is really completed. If this is true, then we can expect an increase in the quotes of the instrument in the coming weeks by 200-300 basis points.
