EUR/USD Technical Analysis: Euro likely to capitalize on bullish “outside-day”

• The EUR/USD created a bullish outside candle yesterday as the intraday high and low engulfed Tuesday’s price action. A bullish reversal, however, would be confirmed only if the follow-through is positive, that is, the spot needs to close today above 1.1388 (high of yesterday’s bullish outside-day).
• The short duration charts are also reporting bullish setup. As a result, the spot is likely to close today above 1.1388.

Hourly Chart

• As seen above, the pair has cleared the resistance of the trendline connecting the Nov. 20 high and Nov. 23 high. That bullish breakout indicates the pullback from the recent high of 1.1472 has ended and the path of least resistance is now on the higher side.  

15-minute chart

• The bull flag breakout indicates a minor bout of consolidation has ended and the rally from the low of 1.1285 has resumed. More importantly, the bullish setup has opened the doors to 1.1468 (target as per measured move method).

Trend: Bullish