FX.co ★ EUR/USD Head & Shoulders Invalidated, 1.2 Eyed!

EUR/USD upside remains intact after yesterday's development. The false breakdown below 1.18 announces more gains. Still, it's premature to talk about a larger bullish run as long as the pair stays below 1.19 psychological level.

The pair is trading at 1.1846 level deep in the buyer's territory. Passing above the former highs makes EUR/USD very attractive for those how are not long already. USDX's drop after yesterday's US data punished the greenback.

EUR/USD has found strong support on the S1 (1.1759) level and now is trading right above the Pivot Point (1.1838) level. The bullish pressure is high if the rate stabilizes above the PP and above the broken warning line (wl1).

USD could lose more ground as the US Dollar Index is vulnerable to slide further. The failure to stay within the down channel between the first warning line (wl1) and the upper median line (uml) signals upside continuation.

• EUR/USD Trading Tips

Buy a bullish fly above the R1 (1.1924), another higher high, with an immediate upside target at 1.2 psychological level. A valid breakout above 1.2 level brings another long opportunity with a higher target.

EUR/USD could give birth to a corrective phase only after another drop below 1.1753 or after a valid breakdown below 1.17.