A wave layout in a 4-hour chart looks absolutely clear and does not require any interpretation. In a few recent days, I was puzzling out whether some waves belonged to any senior wave. Eventually, EUR/USD resumed its climb. Hence, I can make a conclusion that upward wave 3 in 3 is still in progress. If this assumption is true, the pair will rise with a target at near 0.0% Fibonacci level that is the highest point of the latest wave 5 in 5 which was over in January 2021. I expect this level to be broken successfully. So, the whole wave 3 could become lengthy like wave 1 of the uptrend section. Besides, the whole section should look like an impulsive 5-wave structure. I mean that wave 5 will also appear inside this section. All in all, according to the current wave layout, EUR is likely to advance as high as 1.27 or even 1.28 in the coming months.
On Monday and Tuesday, the news background lacks any market catalysts. However, the market does not need strong drivers to assure traders to go on buying EUR/USD. Let me tell you a good example that happened today. Germany reported on its Q2 GDP which actually contracted 1.8% instead of a 1.7% decline in the consensus. Remarkably, investors neglected such worse-than-expected contraction in the largest eurozone's economy and went on buying EUR. Today the economic calendar lacks any macroeconomic metrics. Anyway, I believe that the wave picture is of prior importance nowadays than the news background. In fact, EUR has been enjoying buoyant demand for long. At present, there are no reasons to suppose that the uptrend section will be over soon. Personally, I think that the news background is disregarded by the market deliberately because fresh macroeconomic data proves that the economic recovery in the US outpaces the one in the EU.
Therefore, logically it is the US dollar that should generate strong demand. However, the sections with the USD growth appear very seldom in wave charts. Today, amid the empty economic calendar EUR is extending strength, but not USD. All this indirectly suggests that investors are betting on EUR growth for the reasons other than the news background.
Based on the analysis conducted, my outlook for EUR/USD is still bullish. At the moment, correctional wave 2 or b is complete. Besides, inner wave 2 inside expected wave 3 is also over. Thus, I would recommend carrying on buying EUR/USD with the target at near 1.2340 at every MACD indicator upwards. I guess this is not the right time to revise the ongoing wave layout as it looks almost perfect.
The wave layout of the uptrend section still looks like a complete 5-wave structure. Meanwhile, the layout is not going to get more complicated. The downward section which recently came into being looks correctional and complete. If the ongoing wave layout is right, the new uptrend section is in progress now. Its two waves are already over.
