EUR/USD and GBP/USD Analysis: Wave Structures Signal Bullish Upside

Geopolitical Drivers and Market Environment

Ongoing tensions in the Middle East and evolving U.S. foreign policy developments continue to influence global financial markets. Extended conflict risks, coupled with pressure on global energy markets and military supply chains, maintain an underlying layer of macroeconomic uncertainty across asset classes.

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Despite these broader risk factors, technical patterns in major currency pairs suggest that recent corrective movements may be reaching exhaustion, opening the door for potential bullish momentum in European majors.

EUR/USD Technical Outlook

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The EUR/USD pair remains within a global corrective A-B-C-D-E wave segment. However, current price action indicates this pattern is fully formed and near completion. The market recently attempted and failed to break below the critical 1.1126 level, which coincides with the 50.0% Fibonacci retracement on the higher-timeframe chart.

The defense of the 1.1126 support level signals underlying buying pressure. As the corrective phase concludes, EUR/USD is well-positioned to enter a bullish leg, with higher-timeframe technical targets set toward the 1.1700–1.1800 zone.

GBP/USD Technical Outlook

The wave structure for GBP/USD shows a clear A-B-C corrective pattern that appears to have completed its downside cycle. This structural completion mirrors the technical development seen in EUR/USD, indicating that the recent declining trend in sterling may be concluding.

With the corrective phase finished, GBP/USD is expected to build a new bullish wave structure. Key upside targets are projected above the peaks of former waves B and D, targeting levels above the 1.3700 region. Current technical setups favor long position building, provided key support levels remain intact.

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