EUR/USD surged to as high as 1.2177 last week as rise from 1.0635 resumed through 1.2011 resistance. As a temporary top was formed, initial bias is neutral this week for some consolidations first. Downside of retreat should be contained by 1.2003 support to bring another rise. On the upside, break of 1.2177 will target 61.8% projection of 1.0635 to 1.2011 from 1.1602 at 1.2452 next.
In the bigger picture, rise from 1.0635 is seen as the third leg of the pattern from 1.0339 (2017 low). Further rally could be seen to cluster resistance at 1.2555 next, (38.2% retracement of 1.6039 to 1.0339 at 1.2516). This will remain the favored case as long as 1.1602 support holds.
In the long term picture, the case of long term bullish reversal continues to build up, with bullish convergence condition in monthly MACD, sustained trading above 55 month EMA and long trend falling trend line. Focus is now on 1.2555 cluster resistance (38.2% retracement of 1.6039 to 1.0339 at 1.2516 ). Decisive break there will confirm and target 61.8% retracement at 1.3862 and above.
