EUR/USD: Path to 1.18684 Amid Bullish Structure Shift

  • December 18, 2025
  • Posted by: EWGFX
  • Category: Technical analysis
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The EUR/USD 4-hour chart ,A strong bullish reversal after a long-term downtrend. Identified several key technical milestones that support a “Long” bias toward the 1.18684 target.

Here is a breakdown of the current market structure:

Market Structure Analysis

Trend Shift (CHoCH): You’ve noted the Change of Character (CHoCH) in early November. This was the first signal that the bearish momentum was exhausting and buyers were stepping in.
Break of Structure (BoS): Following the CHoCH, the price has consistently made higher highs and higher lows, confirmed by multiple bullish BoS levels. This confirms a healthy uptrend.
The “Strong Support Zone”: The bounce off the 1.15000 psychological level served as a solid foundation, creating a high-probability “liquidity sweep” before the current rally.

Current Trade Setup

The price is currently hovering around 1.17452, and your chart highlights a specific area of interest for a potential entry:

  1. Fair Value Gap (FVG) & Demand Zone: There is a clear price inefficiency (FVG) resting just above the 1.17000 level. Smart Money Concepts (SMC) suggest that price often returns to fill these gaps before continuing the trend.
  2. Ascending Channel: The price is respecting a bullish channel (indicated by the blue dashed lines). A dip toward the lower boundary of this channel aligns perfectly with your identified Demand Zone.
  3. Liquidity Grab: The gray box at the top (1.18500 – 1.19000) represents a pool of liquidity (buy-side stops). Markets are naturally “drawn” to these areas to find the counter-liquidity needed to close large positions.

Strategy & Risk Management

While the setup looks promising, keep the following in mind:

Entry: Look for a bullish rejection candle (like a pin bar or engulfing candle) once the price touches the Demand Zone/FVG near 1.17100 – 1.17200.
Invalidation: A sustained close below the previous swing low (around 1.16200) would break the bullish structure and invalidate this specific setup.
Target: Your target of 1.18684 is logical as it sits just inside the “Liquidity Grab” zone.