EURUSD volatility spiked yesterday as price made huge swings. While trading near 1.14 price reversed strongly and fell as low as 1.1236. In Elliott wave terms price finished a 5 wave sequence at recent high of 1.1383.

Red line - resistance (broken)

EURUSD has broken out of the bearish downward sloping trend line and was making higher highs and higher lows forming an impulsive 5 wave pattern. Once finished the decline retraced more than 61.8% of the entire upward move and price is now bouncing higher. Usually such price patterns are followed by another similar direction movement, in this case we expect another move higher similar to the initial 5 wave upward move. The first target is close to 1.1420. Failure to stay above 1.1235 will be a bearish sign.