EUR/USD dropped more than 140 pips after the Head and Shoulders pattern neckline break. Subsequently, the descending channel has been formed, and at this point, the pair is stuck around D H3 / W H4 camarilla pivot. 1.2163-78 is the critical POC zone. Rejections above could spike the pair towards 1.2207, and 1h close above should provide a continuation towards 1.2222 and 1.2246. However, 1.2246-50 is a powerful confluence zone due to D H5 / W L3 resistance, and we might see selling from this zone towards 1.2207 retest.
However, a break below 1.2163 provides bearish continuation towards 1.2139 and 1.2118.
W H3 -Weekly Camarilla Pivot (Weekly Interim Resistance)
W L3 - Weekly Camarilla Pivot (Weekly Interim Support)
W H3 - Weekly Camarilla Pivot (Weekly Interim Resistance)
W H4 - Weekly Camarilla Pivot (Strong Weekly Resistance)
D H4 - Daily Camarilla Pivot (Very Strong Daily Resistance)
D L3 – Daily Camarilla Pivot (Daily Support)
D L4 – Daily H4 Camarilla (Very Strong Daily Support)
POC - Point Of Confluence (The zone where we expect price to react aka entry zone)