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. This can be achieved if the current monthly candlestick closes above the weekly high (1.1465) by the end of August.
After such a long bearish rally, which started around the level of 1.1300, long-term bullish rejection took place at 1.0570 (monthly demand level).
Recently, evident bullish recovery was expressed after hitting the level of 1.0800. Since then, bulls have been trying to achieve an extensive bullish movement towards 1.1500 and 1.1700.
Multiple ascending bottoms were established around the levels of 1.0830 and 1.1020. These levels corresponded to the current daily uptrend depicted on the chart.
Since last Friday, extensive bullish pressure was applied until bearish rejection was expressed around the price level of 1.1700. That is when extensive bearish rejection was expressed on Wednesday.
The market looked overbought as the bulls were pushing above the price level of 1.1500 (Daily Supply Level). That's why, a bearish corrective movement is currently taking place towards the price level of 1.1160.
Conservative traders should wait for a valid BUY entry anywhere around the price level of 1.1160 (corresponding to the depicted uptrend line as well as 61.8% Fibonacci level). S/L should be placed below 1.1100.