Instead of a gap between the pullback from the breakout and the old high, there was a little overlap. This is a Negative Gap, but it still can lead to a measured move up.
The EUR/USD daily chart had a strong 5-day rally last week. The final 3 days had shrinking bodies and growing tails. Today’s body so far is a bear body. This is a sign that the rally is losing momentum. However, there is still room to the October and August lower highs, which are magnets.
The 240-minute chart has been in a strong rally. It tried to top with a Low 2 on March 17, but last week broke strongly above that high. The pullback has overlapped the high, but only a little. This is a sign of a strong bull trend. Although there is a little overlap, the overlap can still lead to a measured move up. The overlap is a Negative Gap, which is almost as strong as an actual gap.
The breakout was strong enough to make a 2nd leg up likely. When the market tries to top, like it did on March 17, but then has a bull breakout, and the breakout is followed by a Low 2 or Wedge top attempt, this 2nd top has a better chance of being followed by at least a TBTL Ten Bar Two leg correction. The correction is on the highest time frame that shows the pattern. That is the 240-minute or maybe the daily chart. This means that if the EUR/USD makes another attempt at a top this week, the pattern would be a Low 4 sell setup. It probably will form around a resistance level, like the high and the round number of 1.1500.
The bulls obviously want a breakout above the yearlong trading range and then a measured move back up into the 10-year trading range. It is too early to conclude that this is likely. At the moment, it is unlikely. However, the odds favor at least one more leg up on the 240 minute chart this week, and then another attempt at a top.
The EUR/USD has been sideways for 3 days. The 5-minute chart has rallied for the past 2 hours. Since it is still in the 3-day trading range, it might go sideways more. However, since the 240-minute chart has a bull flag, the odds favor at least one more swing up this week.