Forex Analysis & Reviews: 08.05.2025 - EUR/USD Analysis on May 8,...

Live Chat

InstaForex - Official partner of Dragon Racing

This section features the most important information about trading with InstaForex. We provide both analysis from leading experts for experienced traders and articles on trading conditions for beginners. Our services will help increase your profit potential.

Become Trader

Account Opening

See also

Trading Conditions

Forex Analytics

Charts

This section is designed for those who are just starting their trading journey. InstaForex educational and analytical materials will meet your training needs. Our experts' recommendations will make your first steps to trading success simple and clear.

Start as Beginner

How to start trading

Useful information

Training and recordings

InstaForex innovative services are an essential element of productive investment. We strive to provide our clients with advanced technical capabilities and make their trading routine comfortable as we are recognized as the best broker in this regard.

Become Investor

PAMM System

ForexCopy System

Passive investments

OYS account

Partnership with InstaForex is beneficial and top-tier. Join our affiliate programs and enjoy bonuses, partner rewards, and the possibility to travel with the team of the world-renowned brand.

Become Partner

Main Page

Partner Area

Advantages for Affiliates

Registration

This section contains the most lucrative offers from InstaForex. Receive bonuses when topping up an account, compete with other traders, and get real prizes even when trading in a demo account.

All Promo Campaigns

Bonuses

Contests

Events

Holidays with InstaForex are not only pleasant but also useful. We offer a one-stop portal, numerous forums, and corporate blogs, where traders can exchange experiences and become successfully integrated into the Forex community.

Full details

Forums

We are in social networks

Forex humour

Forex Portal

InstaForex is an international brand created in 2007. The company provides services for online FX trading and is recognized as one of the world's leading brokers. We have won the trust of more than 7,000,000 retail traders, who have already appreciated our reliability and focus on innovations.

Learn More

History

Why Choose Us

InstaSport

Regulation

Company News

Awards

InstaForex Stars

InstaForex Offline

Headquarters

Key documents

Social Responsibility

InstaForex Loprais Team - Official participant of the Dakar rally

08.05.2025 07:33 PM

EUR/USD Analysis on May 8, 2025

The wave pattern on the 4-hour chart for EUR/USD has transformed into a bullish structure. I believe there is little doubt that this transformation was triggered solely by the new U.S. trade policy. Prior to February 28, when the U.S. dollar began to sharply depreciate, the entire wave structure looked like a convincing bearish trend segment. A corrective wave 2 was being built. However, Trump's weekly announcements of various tariffs did their job. Demand for the U.S. dollar began to plummet, and now the entire trend segment beginning on January 13 has taken on a bullish impulsive shape.

Furthermore, the market did not even manage to form a convincing wave 2 within this segment. Only a small pullback was observed, which is smaller in size than the corrective waves within wave 1. However, the U.S. dollar may continue its decline unless Donald Trump completely reverses his adopted trade policy. We've already seen how the news backdrop altered the wave structure once — it could happen again.

The EUR/USD rate declined by 75 basis points over Wednesday and Thursday, which might give the impression that the market reacted appropriately to the FOMC meeting. But that's only an illusion. After the meeting results were announced on Wednesday evening, the dollar gained just 35 points by midday Thursday. It's hard to consider such a move as a logical reaction to Jerome Powell's rather important statements.

And there were many important statements. In fact, what Powell didn't say might have mattered even more. Firstly, it's worth highlighting that the Fed Chair did not give in to Trump's ongoing pressure to lower interest rates. This is nothing new — even the Fed itself is now used to these calls and threats. Powell once again made it clear that the President and the U.S. government have their own agenda, and the Fed has a completely separate mandate. If the current system doesn't suit someone, first the country's laws need to change — only then can anyone instruct the Fed on what to do.

Powell and his colleagues didn't cut rates, as global economic uncertainty remains high, with elevated risks of inflation and economic decline. However, Powell focuses less on the economy and more on inflation, which he has committed to returning to the 2% target.

Given that Trump's tariffs may trigger higher inflation, one could even say that Powell retaliated. Trump creates problems for the Fed by making it harder and longer to reach the 2% inflation target, and Powell is not inclined to fix issues born from Trump's personal motivations disguised as "national interests." Since the Fed rate remains unchanged, the dollar's exchange rate has also barely moved.

General Conclusions

Based on this EUR/USD analysis, I conclude that the instrument is continuing to build a bullish trend segment. In the near term, the wave structure will be entirely dependent on the stance and actions of the U.S. President — this must always be kept in mind. Wave 3 of the bullish trend segment has begun, and its targets may extend up to the 1.25 area. Their achievement will depend solely on Trump's policies. For now, it can be assumed that wave 2 of 3 is nearing completion. Accordingly, I consider buying with targets above 1.1572, which corresponds to 423.6% on the Fibonacci scale.

On the higher wave scale, the wave markup has also transformed into a bullish one. We are likely facing a long-term upward wave sequence, but news directly from Donald Trump can still turn everything upside down again.

Key Principles of My Analysis:

Wave structures should be simple and clear. Complex structures are hard to trade and often subject to changes.
If you're unsure about market conditions, it's better to stay out.
There is never 100% certainty in market direction. Always use protective Stop Loss orders.
Wave analysis can be combined with other analysis methods and trading strategies.

You have already liked this post today

*Disclaimer: The market analysis posted here is meant to increase your awareness, but not to give instructions to make a trade.