the EUR/USD is building an ascending wedge chart pattern. A breakout indicates one more push higher as part of wave 5 (orange) of wave A (grey).
Let’s review the bullish pattern, the expected targets, and when should the bears retake back control.
The EUR/USD break above the 144 ema was impulsive. This is typical for a wave 3 (orange) pattern.
This was the main reason why we expected a shallow and choppy wave 4 (orange). The correction did indeed bounce at the 50-61.8% Fibonacci support zone.
Here are the main scenarios:
On the 1 hour chart, we can see the ABC (green) pattern within potential wave 4 (orange). Now price action could be ready for one more push up in wave 5 (orange).
Price action can either break immediately or first make a pullback to test the Fibonacci support levels. Both scenarios are bullish. This remains valid as long as price action stays above the bottom of wave 4 (orange).