EURUSD has been rising steadily towards 1,31 unfolding in at least one impulsive (5 wave) upward move. If this entire rally from 1,27 area is just part of a corrective move, prices will soon start a sharp decline. The pair trades after having made a high at the 76,8% retracement level and after having completed an A--B-C correction upwards. For this scenario to be confirmed, we have to see 5 waves down that will initially break 1,2950 and then 1,2880. Breaking this important support levels will put pressure on the pair that could accelerate the decline towards 1,27 at first and even lower later.
The bullish scenario needs a small pullback of prices and then a new high in order to complete an entire 5 wave upward move from 1,27 lows. However this would again be the last part of an impulsive move, so a correction would be imminent.
The trend for now in the short and intermediate term is bullish and still inside an upward sloping channel. An exit from the channel would commence the start of a counter trend move downwards. Bulls still have the upper hand with 1,3100-3150 targets a good possibility. Why not 1,32 also...this level was mentioned in one of our previous posts on EURUSD.
As always, thank you for taking the time to read my thoughts.