EUR/USD getting closer to a technical breakout?

Is it only a matter of time before a bigger technical move comes along for EUR/USD? There is a definitely an argument for that when you look at the chart at least. Here's how things are playing out on the daily chart: The pair has been moving in a consolidation phase since the drop back below 1.1000 to start the new year.

And since then, price action has largely sat in between 1.0900 to 1.1000. The key trendline support (white line) has helped to limit the downside on 5 January while the 1.1000 mark itself has helped to limit upside on two occasions already. Taking that into consideration, price action is coiling in a a tight range now with a sort of triangle/flag pattern forming.

And if that is any guide, a technical breakout looks to be on the cards next. The question is, which side might that lean towards? At this stage, there are still considerations for either side. On the dollar side of the equation, the strong bid in Treasuries might keep the dollar in check. But I reckon the central banks outlook would be the more important driver at the end of the day.

Traders have priced in ~82% odds of a March rate cut by the Fed, while an ECB rate cut for April has been fully priced in. While both may end up pushing back against those expectations, I reckon a Fed pushback looks more likely at this stage than the ECB. It all comes down to what the inflation numbers might say next but either way, it is going to be an interesting one.

And even more so when you consider the technical setup for EUR/USD above..