Yesterday, Iran's dissatisfaction with the prospect of lower fuel and oil prices was discussed, an outcome Donald Trump is actively working to achieve. As a reminder, Tehran's main objective at this stage is to ensure the Republican Party loses the US congressional elections. Back in the summer, I noted that the Democrats were currently Iran's strongest political allies because they consistently criticize Trump for what they describe as a pointless war that is damaging both the US and global economies. Therefore, if the Democrats secure a majority in at least one chamber of Congress, they are likely to attempt to initiate impeachment proceedings against Trump again and block his decisions and initiatives.

However, if oil and diesel prices fall, Americans may become more favorable toward the Republicans. If the conflict in the Middle East subsides completely, US voters may conclude that the war is over. If the blockade of the Strait of Hormuz ceases to be effective, oil and gas supplies from the Middle East could once again flow freely to the rest of the world. Tehran therefore has an interest in preventing all the scenarios outlined above from materializing.

As recently as yesterday, Ali Azmaei, head of the Islamic Revolutionary Guard Corps (IRGC), reportedly said that he could hardly wait for the opportunity to sink US ships in the Persian Gulf. In addition, reports indicate that Iran is actively strengthening the defenses of its critical infrastructure. It appears that Iran is preparing for a new escalation of the conflict, potentially seeking to surprise Trump immediately before the elections. Such a move would make considerable strategic sense from Tehran's perspective. If Iran resumes strikes against the Middle East's oil and gas infrastructure, energy prices could rise even further, while Donald Trump's chances of retaining full political control in the United States could decline further. This is precisely the outcome Iran would seek.

Donald Trump, meanwhile, has recently adopted increasingly conciliatory rhetoric. He openly stated that he does not intend to launch further strikes against Iran before the elections, signaling that he has no interest in escalation. If Trump wants to avoid escalation, Iran may have an incentive to pursue it. Therefore, it would not be surprising if Iran were to launch an offensive over the next two weeks. For example, it could carry out new strikes against neighboring countries or attempt to sink US ships in the Persian Gulf.

EUR/USD Wave Outlook:

Based on the EUR/USD analysis, the pair remains within the broader corrective trend structure A-B-C-D-E. However, this structure appears fully developed and may therefore be complete. In my view, current conditions are favorable not only for buying the euro but also for anticipating a sustained upward trend segment. According to the higher time frame, the exchange rate is expected to rise to at least the 1.1700–1.1800 level. The unsuccessful attempt to break above 1.1126, corresponding to the 50.0% Fibonacci retracement level (bottom chart, higher time frame), also indicates that the market may be preparing to move higher.

GBP/USD Wave Outlook:

The wave structure of GBP/USD has become relatively clear. The charts show a distinct corrective A-B-C-D-E structure that may be complete. A similar structure in EUR/USD may also have reached completion. If this assumption is correct, the pound may have finished declining after several weeks of uncertainty about the extent of its weakness. In this case, the pound could not only begin forming a corrective wave but also transition into a sustained upward trend segment, with targets above the peaks of waves B and D, meaning above the 1.3700 level. In my view, current conditions are favorable for establishing long positions.

Key Principles of the Analysis:

1. Wave structures should be simple and easy to understand. Complex structures are difficult to trade and often involve changes in the expected market pattern.
2. If there is uncertainty about market conditions, it is better to stay out of the market.
3. There can never be absolute certainty about the direction of price movements. Always use protective Stop Loss orders.
4. Wave analysis can be combined with other forms of analysis and trading strategies.