The market was pushed lower after breaking below major demand levels around 1.2100 and 1.2000 where historical bottoms were previously hit back in July 2012 and June 2010.
EUR/USD bears have already pushed the price slightly below the monthly demand level at 1.0550 (established on January 1997). Bullish recovery was expressed shortly after.
April's monthly candlestick came as a bullish engulfing one. However, the next monthly candlesticks (May, June, and July) reflected recent bearish rejection being expressed around 1.1450.
In the long term, a projection target will be still located at 0.9450 if a bearish breakdown of the monthly demand level at 1.0550 occurs soon.
On the other hand, a bullish corrective movement towards 1.1500 will be possible only if May's monthly high of 1.1465 gets breached (a low probability).
After such a long bearish rally, which started around the level of 1.1300, bullish rejection took place at 1.0570 (monthly demand level).
Multiple ascending bottoms were established around the levels of 1.0470, 1.0550, and 1.0850. These levels corresponded to the daily uptrend depicted on the chart.
Further bullish pressure was observed until bearish rejection was applied around 1.1400 (double-top reversal pattern). That's when the EUR/USD bears managed to achieve bearish breakdown of the depicted uptrend line on July 13.
Recently, evident bullish recovery was expressed after hitting the level of 1.0800. Since then, bulls have been trying to bring a bullish corrective movement towards 1.1100 and 1.1150 where the backside of the broken uptrend is located.
On Friday, significant bearish reaction has been shown at 1.1150-1.1180 resulting in few consecutive bearish engulfing daily candlesticks.
DAILY closure below the price level of 1.0980 must be achieved to pursue towards lower bearish targets around 1.0850 and 1.0750.
The nearest bearish destination to meet the EUR/USD pair would be located at 1.0980 as long as the price level of 1.1150 remains defended by the market bears.
On the other hand, daily closure above the price zone of 1.1150-1.1180 invalidates the previous bearish scenario. A bullish swing towards 1.1220 and 1.1280 should be expected then.