EURUSD Analysis : Eyes on Bullish Breakout Setup + Target🧭 Current Market Context:
The EURUSD pair is currently trading near 1.16765 on the 4H timeframe, displaying classic accumulation behavior at a key Support-Resistance Interchange Zone (SR Flip). After an extended bearish correction from the previous swing high, price has started compressing in a descending structure underneath a well-respected trendline. This tightening range near a historic support zone suggests that a major breakout could be on the horizon.
🧠 Technical Confluences:
🔹 1. Descending Trendline - Bearish Control Line:
The trendline drawn from the July highs has acted as a clear resistance line, rejecting multiple bullish attempts to break higher.
Price has failed to close above it on the 4H chart, showing sellers are still in control—but momentum is fading.
A breakout of this line is a crucial confirmation of buyer strength returning.
🔹 2. SR Flip Zone - Interchange Area:
This zone previously acted as resistance, capping the rally in June.
After price broke above it, the same area now acts as support, confirming its role as an SR flip zone—a textbook demand level.
Smart money often steps in at these interchange areas to accumulate long positions.
🔹 3. Re-accumulation Phase (Smart Money Behavior):
Market structure is showing a rounded bottom formation, hinting at possible absorption of sell-side liquidity.
Price action is compressing into the support zone, reducing volatility—a signal that a reversal or breakout is near.
The previous similar move ("Same Like This") from late June led to a strong bullish impulsive wave—this historical behavior adds confidence in the current bullish outlook.
🔹 4. Potential Bullish Pattern:
Price needs to develop a bullish reversal pattern (e.g., inverse head & shoulders, bullish engulfing, or a sweep of the low with rejection).
Only then will the setup be validated. This is not a blind buy zone, but a zone of interest for high-probability longs if price confirms.
🧨 Trade Plan Scenarios:
✅ Scenario 1 - Confirmation Breakout:
Wait for a clean breakout above the descending trendline.
Enter on breakout + retest structure.
Target the next major reversal zone at 1.18500.
🐢 Scenario 2 - Early Long Entry:
Enter on bullish confirmation (engulfing, pin bar, etc.) at the SR Interchange zone.
Stop loss below the support box.
Ride early for better R:R if the breakout confirms.
❌ Invalidation:
A clean breakdown below 1.1600 with momentum will invalidate the bullish bias.
In that case, reevaluate based on new structure.
📊 Projected Path:
If the trendline breaks, expect a bullish rally toward the next major resistance zone (1.18500).
That zone has historically acted as a major reversal and profit-taking level for bulls, and we expect price to react again if tested.
🔍 Macro View (Optional Insight):
USD may show weakness due to macro data (CPI/FED talks), helping EURUSD lift.
Eurozone data stability could further fuel demand for EUR.
📌 Final Thoughts:
This EURUSD setup is forming at a high-value area, backed by technical structure, historical behavior, and smart money positioning. If the price reacts positively from this zone and breaks the descending trendline, it could trigger a bullish leg toward 1.18500, offering a rewarding risk-to-reward opportunity for both swing and short-term traders.
Stay patient. Let the market confirm the direction before execution. 📈
