Bullish Pennant Confirms Breakout: Momentum Builds Toward 1.19The pair has formed a textbook bullish pennant on the 4-hour timeframe following a sharp impulsive move upward. Price action consolidated within a narrowing triangle, signaling accumulation before the next leg higher.
The breakout above the pennant’s resistance suggests continuation of the uptrend, with projected Fibonacci targets at:
1.1781 (1.272 extension)
1.1940 (1.414 extension)
Volume behavior confirms the pattern: declining during the consolidation phase and increasing at the breakout, supporting a strong bullish bias.
Fundamental backdrop:
-The US Dollar faces pressure as markets increasingly price in a potential Fed rate cut in the second half of 2025.
-The ECB maintains a more hawkish stance, reinforcing euro strength relative to USD.
-Eurozone economic data shows signs of inflation stabilization, while US CPI readings remain mixed.
-Capital rotation favors major currencies with resilient monetary policies and macroeconomic stability.
As long as EUR/USD holds above 1.1476, the bullish scenario remains intact. A move toward 1.1781 and 1.1940 appears likely. A breakdown below 1.1237 would invalidate the pennant and shift momentum toward support retests.
