Technical summary:

We have finally seen a break above 1.6000, which confirms that wave c higher is developing. Wave c is expected to be a very powerful impulsive rally higher to 1.6273 and 1.6446 on the way towards 1.6800 and possibly even higher to 1.7124. We have recognized this as being a rare expanded diagonal, where each of the waves are larger than the prior wave, meaning that wave iii is an 161.8% extension of wave i. Therefore, we expect the ongoing wave v to be an 161.8% extension of wave iii call for a strong rally higher to 1.7124. In the short term, we still need minor resistance at 1.6140 and more importantly resistance at 1.6273 to be broken to feel comfortable about the rally higher to 1.6446 and above. Ideally, we will now see support at 1.5980 protect the downside, but only a break below 1.5908 will delay the expected upside.

Trading recommendation:

We are long in EUR from 1.5830 and will move our stop higher to 1.5900. If you are not long in EUR yet, then buy near 1.5980 with the same stop at 1.5900.