To date, Donald Trump has signed several trade agreements and at the same time imposed tariffs—by conservative estimates—against half the countries in the world. The most notable and significant of these deals are with the UK, Japan, and the European Union. As soon as even minimal details of these agreements became known, all economists unanimously called them highly favorable to the US and "onerous" for the other countries. On Thursday, the terms of one such trade deal—with Japan—were made public. Let's take a look at those terms.

So, Washington and Tokyo have agreed that Japan will invest $550 billion into the American economy. In practice, this will work as follows: Trump personally will select specific projects into which Japan must invest its own funds. If Tokyo disagrees with any chosen project, Washington reserves the right to raise trade tariffs. Note that the European Union, for example, has also committed to invest a similar amount in the US economy—and likely on similar terms. In both cases, we are not talking about zero tariffs on imports in exchange. For Japan, most goods will be subject to a 15% US tariff.

A memorandum between Japan and the US states that Washington will not increase tariffs on Japanese imports as long as Japan abides by the terms of the agreements, which makes sense. After Trump selects a new project for Japanese investment, Tokyo will have 45 days to transfer the required funds to the US. For each project, a separate company will be created and controlled by Americans.

It is reported that Japan plans to raise the necessary funds for American projects via loans backed by state guarantees—in other words, by issuing bonds. Tokyo's direct investment will only constitute 1–2% of the total amount, and project profits will be split in a 90%/10% ratio: America receives 90%. As we can see, this is a very favorable trade deal for the US.

Wave Structure for EUR/USD:

Based on my analysis, EUR/USD continues building an upward trend segment. The wave structure still depends entirely on news driven by Trump's decisions and US foreign policy. The trend targets may reach as high as the 1.25 area. Therefore, I continue to favor buys with targets around 1.1875 (the 161.8% Fibonacci level) and higher. I assume wave 4 is complete, so now is a good time to buy.

Wave Structure for GBP/USD:

The GBP/USD wave structure is unchanged. We are in a bullish, impulsive phase of the trend. Under Donald Trump, markets may see many shocks and reversals that could strongly impact the wave picture, but for now, the working scenario is intact. The targets for the bullish move are now around 1.4017. I believe the downward wave 4 is complete; wave 2 in 5 may also be complete or near completion. Thus, I recommend longs with a target at 1.4017.

Key Principles of My Analysis:

1. Wave structures should be simple and clear. Complex structures are hard to trade and prone to change.
2. If you are unsure of the market, it's better to stay out.
3. You can never be 100% confident of price direction. Always use protective Stop Loss orders.
4. Wave analysis can (and should) be combined with other types of analysis and trading strategies.