the EUR/USD seems to have completed a triangle chart pattern. The shallow retracement could indicate the end of the wave 4 (pink) and the restart of the uptrend.
The EUR/USD break above the resistance trend line with strong price action confirms that the bulls are back in control.
But the real test will be what happens when price makes a pullback. We should expect a pullback to occur before the breakout is 100% confirmed
The internal price swings seem to match an ABCDE (grey) chart pattern within wave 4 (pink). Price is now moving up within a wave 5 (pink) of a potential larger wave 3 (purple).
An unexpected break below the support, however, could indicate a false breakout. This would create a deeper pullback (dotted orange line) towards the 38.2% Fibonacci level, which is expected to act as a bounce.
On the 1 hour chart, price action is building that pullback after the bullish breakout. It is now testing the Fibonacci support levels, which is a key decision zone.
A bearish breakout below the bottom invalidates the breakout and indicates one of two things:
A bullish break above 1.2250 should send this pair higher towards the immediate target at 1.2325 with possible extensions at 1.24 and 1.25.