📊 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.
🧠 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.
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.