A new "shutdown" could begin in America on February 1. Will anyone be surprised by this? In my opinion, during Donald Trump's next three years in office, America may be swept by a record number of "shutdowns." I want to remind you that, in general, a government shutdown is rare in the U.S., occurring about once every five years. However, under Trump and with his diplomatic abilities, the country could face a second "shutdown" in the last six months. There is a chance that Democrats and Republicans will come to an agreement before next month, but that chance is quite low. Therefore, the question currently on the markets' minds is: "How long will American government institutions be paralyzed this time?"

The Democrats are once again ready to block funding for the government, but this time, for the second consecutive time, they are more on the side of good than evil. Last fall, the Democrats opposed cuts to medical and social programs for the American population, which Trump decided to trim with his "One Big and Beautiful Bill." This time, the Democrats are demanding reforms in the Immigration and Customs Enforcement (ICE), whose agents shot at U.S. citizens twice in the past month, resulting in deaths. The Democratic Party is firmly against increasing funding for this agency to $10 billion. Also, it requires that agency agents not wear masks and make arrests only upon a warrant, not at their discretion. Additionally, the Republicans' main opposition is demanding stricter oversight of the agency's actions and harsher penalties for misconduct.

Senate Democratic Leader Chuck Schumer stated, "The American people support law enforcement and the need to secure the borders. But they do not support terrorism against our citizens by ICE agents and the killing of Americans."

Based on all of the above, a new "shutdown" poses a real threat and could further force the market to reduce demand for the US currency. I remind you that the market bases its trading strategies not on individual factors and news alone. A snowball of problems has formed around the dollar, and the growth of this snowball is fully supported by the president of the country.

Wave Picture for EUR/USD:

Based on the analysis of EUR/USD, I conclude that the instrument continues to build an upward trend. Donald Trump's policies and the Fed's monetary policy remain significant factors in the long-term decline of the American currency. The targets for the current segment of the trend may reach the 25 figure. At this moment, I believe that the global wave 4 has completed its formation, so I expect further increases in quotes. However, I also expect a downward wave in the near future, as the series of waves a-b-c-d-e appears to be complete. In any case, I would not advise anyone to trade the correction at this time.

Wave Picture for GBP/USD:

The wave structure for the GBP/USD instrument has become clearer. The presumed wave 5 in wave 5 is currently forming, but the internal wave structure of global wave 5 may take on a much more elongated appearance. I believe that the current upward wave set is close to completion or has already completed. Consequently, a corrective wave or wave set may begin to form soon, after which the main trend will likely resume with targets positioned above the 39 figure.

Main Principles of My Analysis:

1. Wave structures should be simple and clear. Complex structures are difficult to trade and often carry changes.
2. If there is no confidence in what is happening in the market, it is best not to enter it.
3. There can never be 100% certainty in the direction of movement. Do not forget about protective Stop Loss orders.
4. Wave analysis can be combined with other types of analysis and trading strategies.