EUR/USD, H4 time frame:
We will take a look if the market follows the forecast created several days ago.
So far, the EUR/USD pair is moving according to the scenario. It can be assumed that a deep correction is currently forming, which takes a triple zigzag [W]-[X]-[Y]-[X]-[Z] form.
The market has most likely completed the construction of the upward wave of the bundle [X], which consists of three main sub-waves and takes the form of a simple zigzag (A)-(B)-(C). If so, we can expect the development of the current wave [Z] in the medium term. However, it is still difficult to say what correction pattern the wave [Z] will adopt.
Now, let's consider the layout of the last section of the chart on the hourly time frame, so that we know what trading decision to make.
EUR/USD, H1 time frame:
Looking at the hourly time frame, it is not yet clear what the pair is currently building; perhaps, the first impulsive wave of the downward zigzag, which will eventually form wave [Z]. However, it can be noticed here that the last impulse wave 5 of C looks fully done, which gives the market a signal to reverse and start to decline.
The EUR/USD pair is expected to decline within the wave [Z] below the level of 1.2050 in the near future. It is worth noting that this is the previous price low, which was marked by the correction 4.
Currently, opening short positions can be considered in order to make a profit at the specified level.
