Donald Trump's war with the Federal Reserve is a story worthy of a future Hollywood movie. Trump wants to seize control over the central bank to have full power over interest rates. Lowering the rate would provide the US with cheaper servicing of its enormous Treasury debt, boost domestic investment in the economy, and accelerate GDP growth. But as the economy grows, so will inflation.

Has anyone wondered why the Fed so stubbornly refuses to bow to Trump's demands? Why not cut rates by 1–1.5%, as demanded by Treasury Secretary Scott Bessent? Because America isn't just full of Elon Musks and Bill Gateses. For ordinary Americans, trade tariffs on most imported goods and higher inflation pose a significant challenge to their budgets and standard of living. The Fed understands this, so it strives to strike a balance between maintaining an appropriate level of inflation, promoting economic growth, and ensuring full employment. Other central banks strive for a similar balance. Without it, central banks everywhere would cut rates to zero (or even negative) in a perpetual bid to stimulate the economy, and as a bonus, keep printing more money to drive up GDP further. But such policies risk runaway, double-digit inflation, which hurts all layers of society, but especially the most vulnerable—and they are the majority everywhere.

Trump does not care what will happen in five or ten years. He doesn't care about the consequences his policies will bring to the USA in the future. Trump is 79 years old. He wants to go down in US history as the most successful president ever—to be in the Hall of Fame alongside Abraham Lincoln and George Washington. Trump wants a Nobel Peace Prize, record rates of US economic growth, a legacy that will immortalize his name—whatever the methods and regardless of the sacrifices.

Given all of the above, I believe the US dollar has no real prospects over the coming years. Of course, the dollar is unlikely to crash to, say, $2 against the euro or $3 against the pound sterling. However, the trend is expected to be downward for the US currency for many years. At least, that's the only conclusion I can draw today.

Wave Pattern for EUR/USD:

Based on my analysis of EUR/USD, I conclude that the instrument continues to form an upward trend segment. The wave pattern still entirely depends on the news background related to Trump's actions and US foreign policy. The targets for this trend segment can go as high as the 1.25 level. Accordingly, I continue to consider buys with targets around 1.1875, which corresponds to 161.8% Fibonacci, and higher. I believe wave 4 has been completed. Therefore, now is still a good time to buy.

Wave Pattern for GBP/USD:

The wave pattern for GBP/USD remains unchanged. We are dealing with an upward, impulsive segment of the trend. Under Trump, the markets could experience many more shocks and reversals that could significantly impact the wave picture, but for now, the main scenario remains intact. The targets for the upward move are now at approximately 1.4017. I currently believe that the downward wave 4 has ended, and wave 2 in 5 may also be complete. Accordingly, I advise buying with a target of 1.4017.

Main principles of my analysis:

1. Wave structures should be simple and clear. Complicated structures are hard to trade and often change.
2. If you're not confident about what's happening in the market, it's better to stay out.
3. 100% certainty in the direction of movement is impossible. Don't forget about protective Stop Loss orders.
4. Wave analysis can be combined with other types of analysis and trading strategies.