EUR/USD Price Analysis: Teases falling wedge confirmation above 1.1850

• EUR/USD retreats inside a two-week-old bullish chart pattern.
• Monthly resistance line, 100-SMA add to the upside filters, bullish MACD signals favor buyers.
• Bears have a bumpy road ahead, formation support to restrict immediate downside.

EUR/USD keeps Friday’s bounce off three-month low inside a bullish chart pattern, falling wedge, during the initial Asian session on Tuesday. In doing so, the currency major pair attacks the wedge’s resistance line near 1.1870 by the press time.

Given the bullish MACD and the quote’s corrective pullback from a multi-day low, EUR/USD prices may confirm the bullish chart pattern with an upside break of the 1.1870 immediate hurdle.

However, the pair’s following upside will be hindered by a downward sloping trend line from early June and 100-SMA, respectively around the 1.1900 threshold and 1.1940 levels.

Also acting as an upside filter is the June 25 top of 1.1975 and the 1.2000 psychological magnet. It’s worth noting that the EUR/USD run-up beyond the 1.2000 level will recall the bulls.

Alternatively, the support line of the stated chart pattern and the recent low, around 1.1840 and 1.1815 in that order, may restrict the short-term downside of the pair ahead of the 1.1800 round figure.

It should, however, be noted that the quote’s weakness past 1.1800 will make it vulnerable to test the 1.1760 support on its way to the yearly low near 1.1700.

EUR/USD four-hour chart

Trend: Recovery expected