EUR/USD is building a bull flag chart pattern. This is an indication that the uptrend is expected to soon continue.
But price action must remain above the critical 1.20 support zone. Otherwise the bulls are losing control.
The EUR/USD bull flag pattern is probably part of a wave 4 (orange). The recent strong push higher is typical for a wave 3 (orange).
Of course, today’s price movement will also depend on the news from the European Central Bank expected today 10 December.
Price Charts and Technical Analysis
The wave 4 remains valid as long as price action stays above the 50 – 61.8% Fibonacci retracement and the 1.20 support zone.
Also, a bullish break is a key confirmation of the uptrend. It also confirms the end of wave 4 and the start of wave 5. The main target is the -27.2% Fibonacci target at 1.2250.
On the 1 hour chart, the key decision zone is at the top of the 21 ema (purple box).
A bullish breakout confirms the uptrend continuation (green arrows).
A bearish bounce confirms a deeper pullback in wave 4 (orange arrows).
The main targets of the bearish breakout are at the -27.2% Fib at 1.2050 and the -61.8% Fib at 1.2020.
