EUR/USD is attempting to correct higher but is facing pressure from the bears. The following is a top down analysis that arrives at a bearish conclusion while below weekly resistance.
The weekly chart above sees the price attempting to dig deeper into the demand zone although the path of least resistance could well be for a bullish correction in the coming days.
On the other hand, the outlook is bearish while below the resistance.
From a daily perspective, the price is trapped between the W-formation and the M-formation’s necklines. A break of their of these areas would likely encourage flow into the direction of the price action and potentially lead to a breakout one way or another. 1.1250 and 1.1303 are support and resistance. Given that the lows of the day was 1.1227, there is a bias to the downside for the upcoming sessions.
The price has formed a W-formation on the hourly time frame, as seen more clearly on a line chart as follows:
The W-formation is a reversion and bearish chart pattern. The price would be expected to move in on the neckline of the W-formation. This has a correlation with the 61.8% Fibonacci of the latest bullish hourly impulse near to 1.1245. A break there opens risk of a run towards 1.1202, or the -61.8% retracement of the recent bullish correction’s range.