Next week we have the US election on tuesday and FED on thursday, so the volatility should be good for both bulls and bears, with moves in both directions, most probably. When looking at the EU chart, it looks very bearish, as we predicted last week, BUT when I look at the hourly setup, I see a lot of hidden bullishness. Thats why I do not plan to short this move any further, for now. I see 2 options…either this move really is bearish and we could short the correction towards 1750-1770 or this move will start a bull into 1830+, possibly 1920. Either way, bulls should be safe early in the week. And a SL area is clearly visible on the chart, too. Interresting things are happening with GU now during the weekend, with the weekend price being 80 pips lower than the friday’s closing price. BUT it is yet to see if the market opens with a gap this big or if the price goes back to the closing levels before market opens. This weekend pricing is not very reliable, especially on saturdays, so it will be interresting to follow what happens. If no gap, GU should go above 3100, as the 2900 area is creating strong support zones and unless 2850 is broken safely, 3100 and higher seems unevitable. I expect some positive brexit news, too, so I prefer to buy the dips, until the deal if final. Then we might see the “buy the rumor, sell the fact” scenario. Right now, everyone seems to be shorting GU..once a brexit deal is final, retail will most definitely start buying the pound and thats when I would like to start selling. But first, lets see if the gap really develops and if it does, if the market can close it on monday.
