The pair was in an uptrend from 1.0400 to 1.0600, which prevented further losses.
The rising lows at 1.1150 and 1.1750 showed that bulls were strong and could push the price higher than 1.1750.
Bulls faced resistance at 1.2340, but they overcame it. However, they could not make a new high and instead repeated the same high level, forming a double-top pattern.
This led to a downward correction to 1.1800, which was seen as a good buying opportunity with a target around 1.2350.
The latest fundamental analysis shows that the USD has been hurt by low interest rates and inflation concerns.
However, traders should be careful and watch out for any news that could affect the pair's performance.
If the pair keeps rising steadily above 1.2340, it could reach 1.2700.
But if the current breakout turns out to be false, another drop to 1.1750-1.1800 could happen.