{"id":13395,"date":"2025-06-05T13:33:09","date_gmt":"2025-06-05T13:33:09","guid":{"rendered":"https:\/\/alchemymarkets.com\/?post_type=market_insights&#038;p=13395"},"modified":"2025-06-05T13:33:11","modified_gmt":"2025-06-05T13:33:11","slug":"eur-usd-ecb-cut-euro-rallies-so-is-wave-4-really-done","status":"publish","type":"market_insights","link":"https:\/\/alchemymarkets.com\/sv\/education\/market-insights\/opening-bell\/eur-usd-ecb-cut-euro-rallies-so-is-wave-4-really-done\/","title":{"rendered":"EUR\/USD: ECB Cut, Euro Rallies \u2013 So\u2026 Is Wave 4 Really Done?"},"content":{"rendered":"\n<p>The ECB went ahead with the expected 25bps rate cut yesterday, taking the deposit rate down to 2.00%. On paper, that\u2019s dovish \u2013 a cut is a cut. But the euro didn\u2019t fall. In fact, it did the opposite. It rallied. And if you&#8217;re watching price action as closely as I am, that\u2019s the kind of move that makes you stop and ask:&nbsp;<em>what\u2019s actually driving this?<\/em><\/p>\n\n\n\n<h2 class=\"wp-block-heading\">So, Why Did the Euro Rally?<\/h2>\n\n\n\n<p>Let\u2019s break it down. Yes, the ECB cut rates, but the guidance that followed wasn\u2019t exactly screaming \u201cmore cuts are coming.\u201d In fact, it was the opposite \u2014 data-dependent, cautious, and non-committal. That&nbsp;<em>tone<\/em>&nbsp;matters. Markets didn\u2019t hear, \u201cwe\u2019re staying dovish.\u201d They heard, \u201cwe\u2019ve cut, now we wait.\u201d<\/p>\n\n\n\n<p>On top of that:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>The cut was already fully priced in<\/li>\n\n\n\n<li>The dollar\u2019s under pressure (thanks to U.S. trade tensions and fiscal noise)<\/li>\n\n\n\n<li>Eurozone fiscal policy is turning up with a big push in defense and infrastructure spending<\/li>\n<\/ul>\n\n\n\n<p>Put that all together, and you\u2019ve got a market that\u2019s not responding to the cut itself, but to the&nbsp;<em>absence<\/em>&nbsp;of anything worse. That\u2019s why EUR\/USD pushed higher. It&#8217;s not really bullish on the euro \u2014 it\u2019s just not bearish anymore.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Now, Let\u2019s Talk Charts \u2013 Where Are We in the Bigger Picture?<\/h2>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"696\" src=\"https:\/\/alchemymarkets.com\/wp-content\/uploads\/2025\/06\/image-1-1024x696.png\" alt=\"\" class=\"wp-image-13396\" srcset=\"https:\/\/alchemymarkets.com\/wp-content\/uploads\/2025\/06\/image-1-1024x696.png 1024w, https:\/\/alchemymarkets.com\/wp-content\/uploads\/2025\/06\/image-1-300x204.png 300w, https:\/\/alchemymarkets.com\/wp-content\/uploads\/2025\/06\/image-1-768x522.png 768w, https:\/\/alchemymarkets.com\/wp-content\/uploads\/2025\/06\/image-1-1536x1044.png 1536w, https:\/\/alchemymarkets.com\/wp-content\/uploads\/2025\/06\/image-1-2048x1392.png 2048w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><\/figure>\n\n\n\n<p>Looking at EUR\/USD on the 4H, we\u2019re climbing inside a clean ascending channel. There\u2019s definitely a case to be made that Wave 4 is done \u2014 price has pulled back, consolidated, and now we\u2019re seeing higher highs and higher lows.<\/p>\n\n\n\n<p>But here\u2019s the thing:&nbsp;<strong>this rally doesn\u2019t feel impulsive<\/strong>. It\u2019s messy. Choppy. A bit too overlapping. That\u2019s not typically what you&#8217;d expect from a proper Wave 5 \u2014 not at this stage. So I\u2019m stepping back and asking whether this move is really the start of something new, or just another leg in something more complex.<\/p>\n\n\n\n<p>If we apply Elliott\u2019s principle of alternation, Wave 2 was sharp and deep \u2014 a classic zigzag. So it would make sense for Wave 4 to be a bit more drawn out, sideways, and maybe even still in play. That fits with the idea that what we\u2019re seeing now might be part of a&nbsp;<strong>larger, more complex corrective structure<\/strong>&nbsp;\u2014 possibly a flat or a triangle. The structure hasn\u2019t confirmed itself yet, so I\u2019m cautious about getting too committed to either side.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\">Bottom Line<\/h2>\n\n\n\n<p>Yes, the euro\u2019s up. Yes, the ECB just cut. But this isn\u2019t about rates \u2014 it\u2019s about expectations. The cut was priced in. The guidance wasn\u2019t as dovish as feared. Combine that with a weaker USD backdrop, and the rally makes more sense.<\/p>\n\n\n\n<p>Technically though, I\u2019m not fully convinced we\u2019re in a clean Wave 5 just yet. The move inside the channel is too unconvincing to call it impulsive. For now, I\u2019m open to the idea that Wave 4 could still be unfolding into something broader \u2014 but I\u2019ll need more clarity before I shift bias.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Despite a dovish ECB rate cut, EUR\/USD rallied\u2014but is the impulsive wave truly underway, or are we still deep in Wave 4?<\/p>\n","protected":false},"author":162,"featured_media":13397,"parent":0,"comment_status":"open","ping_status":"closed","template":"","market_insights_categories":[17],"class_list":["post-13395","market_insights","type-market_insights","status-publish","has-post-thumbnail","hentry","market_insights_categories-opening-bell"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.9 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>EUR\/USD: ECB Cut, Euro Rallies \u2013 So\u2026 Is Wave 4 Really Done? - Alchemy Markets<\/title>\n<meta name=\"description\" content=\"EUR\/USD rallied after the ECB\u2019s rate cut, but is Wave 4 complete or still unfolding? 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