the EUR/USD is moving higher within a larger uptrend. But the bulls should remain cautious. Why?
Because the price action is corrective and choppy. Which is indicating a larger correction before the US Presidential elections on November 3. Let’s review the daily and 4 hour charts.
The EUR/USD is building a bullish ABC (blue) pattern. This remains valid as long as price stays below the Fibonacci levels of wave wave B vs A. A larger ABC (purple) correction is developing within the wave 4 (pink).
A wave 4 is usually choppy, corrective and long. A 38.2% Fibonacci retracement level is also very common. A strong bullish bounce at that Fib would confirm the wave 4. Only a strong bearish break below the 61.8% Fib makes the wave 4 (pink) invalid (red x). After the wave 4 ios completed, we are expecting a wave 5 to complete wave A (orange).
On the 4 hour chart, price action could be completing a final wave 5 (green). But price action must respect the Fibonacci levels of wave 4 (green) vs 3. A break below that support zone indicates that the wave C (blue) has already been completed.
A final push up is expected to complete wave 5 (green) and wave C (blue) of a larger wave B (purple) at the 78.6% or perhaps even 100% Fibonacci level. A bearish reversal or breakout could end the wave B and start the bearish wave C.