EUR/USD Analysis (1H Timeframe) — Bullish Continuation

📊 EUR/USD Analysis (1H Timeframe) — Bullish Continuation from Falling Wedge Breakout
🧠 Market Overview
The EUR/USD pair has been exhibiting strong bullish behavior in the preceding sessions, climbing sharply in a near-vertical rally. After a period of extended buying, the pair began to consolidate and correct, forming a clear Falling Wedge — a pattern often associated with bullish breakouts when occurring in an uptrend.

This type of price action reflects temporary profit-taking and rebalancing, rather than a reversal. Institutional players often use this phase to re-enter positions at better prices, leading to a renewed rally upon breakout.

🔍 Technical Pattern: Falling Wedge
📐 Pattern Structure:
The Falling Wedge is characterized by two converging downward-sloping trendlines.

Price touches both the upper resistance line and lower support line multiple times, validating the wedge's integrity.

The wedge represents a compression of price and volatility, typically preceding a sharp directional breakout.

💡 Pattern Psychology:
Sellers become progressively weaker with lower highs, but buyers consistently defend key support zones.

As the wedge tightens, breakout potential increases — and in this case, the bullish breakout occurred with momentum.

The breakout candle is large, green, and accompanied by follow-through, indicating buyer commitment.

🔂 Key Levels
🔵 Support Zone: 1.12948
This area has acted as a foundation for the wedge and a zone of demand.

The price rebounded from this level multiple times, confirming its validity as a strong support.

🔴 Resistance Zone: 1.14563 – 1.14588 (Take Profit Area)
This region marks the most recent significant supply zone, where the price was previously rejected.

The TP is placed just below resistance for a higher probability of fill.

🔁 Breakout Confirmation:
Price breaks above the descending resistance of the wedge and successfully retests the breakout zone before moving higher.

The retest confirms a textbook breakout, giving traders confidence to enter long positions.

🎯 Trade Setup Details

Element Description
Entry Post-breakout candle close or on retest
Stop Loss Below support zone at 1.12948
Take Profit Resistance zone at 1.14563
Risk/Reward Favorable (approx. 1:2+)
Bias Bullish — Continuation Pattern
The setup follows the principles of breakout trading, emphasizing:

A tight stop

Defined pattern breakout

Retest confirmation

Logical TP based on market structure

📈 Trend Analysis
✅ Prior Trend:
Strong impulsive rally leading into the pattern

Suggests the wedge is a continuation pattern, not reversal

🔄 Transition:
Price coils inside the wedge — typical consolidation before the next leg up

📊 Momentum Shift:
Breakout shows renewed bullish interest

Buyers regain control and push past resistance

🧠 Professional Insight & Market Psychology
This chart demonstrates a classic example of a bullish continuation setup driven by market structure and price action analysis. The falling wedge not only provides a technical entry point, but also reflects the broader market psychology — where buyers are quietly accumulating before launching the next wave upward.

What makes this setup high quality:

Clear and clean pattern formation

Precise breakout and retest

Confluence with horizontal support/resistance levels

Supportive market context (uptrend structure)

This type of setup is favored by institutional and swing traders for its high probability and clear invalidation points.