On Wednesday, EUR/USD continued to decline after rebounding from the 127.2% retracement level at 1.1700, moving toward the 100.0% retracement level at 1.1620. A rebound from 1.1620 would favor the euro and a resumption of growth toward 1.1700. Consolidation below 1.1620 would allow traders to expect a continuation of the decline toward the next Fibonacci level of 76.4% at 1.1551.

The wave situation on the hourly chart remains "bullish." The last completed downward wave did not break the previous low, while the latest upward wave broke the previous high. Geopolitical developments remain consistently negative: negotiations between Iran and the United States are not taking place, and the blockade of the Strait of Hormuz remains in place. However, the FOMC's stance is currently more important for the dollar, and it remains highly contradictory.

The fundamental background on Wednesday allowed the bears to continue their attacks, but the chart shows that the bears themselves are not particularly eager to do so. The pair's decline is minimal, and traders do not want to draw any conclusions based on lower-tier reports. Yesterday, the only report that worked in the bears' favor was the U.S. durable goods orders report, which showed a higher reading than expected. Meanwhile, the second estimate of GDP for the second quarter showed the same figure as a month earlier—1.5% quarter-over-quarter. Thus, the economic situation did not deteriorate, but neither did it improve. The market continues to await Friday's speech by Fed Chair Kevin Warsh, as well as the annual revision of the Nonfarm Payrolls report. From the beginning of the week, traders have focused their attention on these two events, on which a great deal depends. If Kevin Warsh manages to convince the market that monetary policy tightening is still planned because inflation is too high, the bears may feel a surge of strength. However, the Nonfarm Payrolls report could well deliver another setback to the dollar.

On the 4-hour chart, the pair consolidated above the 61.8% retracement level at 1.1649. Thus, the euro's growth may continue toward the next Fibonacci level of 76.4% at 1.1726. The upward trend channel points to a full-fledged "bullish" advance. Expectations of U.S. dollar strengthening will become justified only after the price closes below the channel. No developing divergences are currently observed on any of the indicators.

Commitments of Traders (COT) Report:

During the latest reporting week, professional traders closed 945 Long positions and 1,876 Short positions. Over the seven weeks in February and March, the bulls' overwhelming advantage evaporated because of the war in Iran, while over the past twenty-one weeks, the situation has leveled out amid the apparent ceasefire and the market's hopes for an end to the war. The total number of Long positions held by speculators currently stands at 196,000, while the number of Short positions is 255,000. The bears are once again taking the lead.

Overall, over the long term, large market participants continue to show strong interest in the euro. Clearly, events of various kinds around the world—which have been plentiful in recent years—affect investor sentiment. In particular, the market is currently keeping a close eye on the situation in the Middle East, where the war repeatedly appears to end and then resumes. The market initially ignored the ceasefire and then ignored the resumption of the war. Thus, geopolitics no longer determines the dollar's fate on its own.

News Calendar for the United States and the European Union:

• Germany – Consumer Confidence Index (06:00 UTC).
• United States – Change in Initial Jobless Claims (12:30 UTC).

On August 27, the economic events calendar contains two entries, both of secondary importance. The economic background is expected to have an extremely weak or no impact on market sentiment on Thursday.

EUR/USD Forecast and Trading Tips:

Buying the pair today is possible following a rebound from 1.1620 on the hourly chart, with a target of 1.1700. Selling was possible following a rebound from 1.1700 on the hourly chart, with a target of 1.1620. These trades can still be kept open.

The Fibonacci grids are drawn from 1.1620–1.1325 on the hourly chart and from 1.1849–1.1325 on the 4-hour chart.