The EUR/USD rallied from a fresh low on the year at 1.2247 this week, to 1.2447. Even after this 200-pip rally, we can see that EUR/USD has a lower low and a lower high, continuing a bearish structure. On the other hand, it is losing some bearish bias and momentum as price climbed above the 200-, 100-, and 50-hour SMAs, while the 1H RSI pushed to 70, showing some near-term bullish momentum. (EUR/USD 1H Chart 12/10; click to enlarge) At the moment, the bearish outlook is prevented by a key support in the short-term in the 1.2340-1.2360 area, which involves the current intra-session support around 1.2360, down to the 100-, and 50-hour SMAs, and a previous support/resistance pivot at 1.2340. A break below 1.2340 first opens up the 1.2280-1.23 area, then the 1.2245-1.2250 area. Now if there is a break above 1.24, there would be pressure towards the 1.2450 area. Now a break above 1.2450 would break above a falling channel coming down from the 1.26 resistance in November. A little higher, and price will be above a resistance pivot last week, showing a higher high and thus shifting the EUR/USD to a sideways market in the short-term. That would introduce bullish risk towards the 1.26 level, and also limit the bearish outlook to 1.2280-1.23, or at most 1.2250. (If price does not break above 1.2450 the downside risk with a break below 1.2340 goes to 1.2250 and towards the 1.22 handle.) (EUR/USD 4H Chart 12/10; click to enlarge)