Chart of the day

EURUSD is breaking above the critical medium-term resistance of 1.0770. This break could open a complete reversal higher which tends to invalidate a downside count and confirm that the short-term five waves down are finished, but we need to see a confirmed break above 1.0900 for this to happen.

I see this still as a pullback in the fourth wave before a continuation lower in the fifth wave as long as it is below 1.0900. We need to see a clear confirmed break below 1.0600 in the coming days and weeks to support this count lower. Invalidation will come only upon a confirmed break below 1.0900 and then I will look at the 1.11700 resistance test.

Long trades could be opened here with a stop loss below 1.0750. Short trades should be opened in the case of a confirmed break below 1.0650. These are a key resistance/support level so use small sizes and tight stops.