EUR/USD Price Analysis: Bears are lurking on the hourly time frame

• EUR/USD bulls are building positons ahead of key NFP.
• A blow off to the downside could be in order sooner than later. 

EUR/USD has been carving out the upside on Thursday and this could be teeing up a set-up for Friday as volumes start to get trapped up high within the week's range. More on that below. Meanwhile, the US Dollar eased after a brief rebound on Thursday as data showed the US labour market remains strong. This comes ahead of Friday's Nonfarm Payrolls data on Friday.

Forex is being driven by the sentiment in the futures markets that have raised the probability of the Fed hiking interest rates by 25 basis points to 92.4% when policymakers conclude a two-day meeting on July 26, the CME Group's FedWatch Tool showed on Thursday.

Meanwhile, going to the charts, we can see that the bulls are in the market:

EUR/USD H4 chart

We have seen the price rally from an area that could turn out to be weak lows. We have started to build up a long market from here and that leaves the length vulnerable to a squeeze for the days ahead. 

EUR/USD H1 charts

However, zooming in on the hourly chart, should 1.0900 territories hold up, after a move into trendline liquidity, then we could be facing a break to the downside for the day ahead based on the weekly template.

The first three days of the week that reset as a new three-day cycle on Wednesday saw a blow-off from below-trapped volumes up high and we could be seeing the same phenomenon play out for Friday as illustrated above. A drop below the higher volumes and trendline support will target low-hanging fruit, LHF, below.