A very bearish week behind us, with some bullish potential for the next one. First, we re-tested the 100 USDx area again, many times…all thursday and friday. Chart below explains it the best. The question is, if this was a lost FIGHT for dollar bulls, or a lost WAR. If it was the war…dollar has a lot of room to drop. Hundreds of pips…we will find out next week.
This reflects directly into EU, once we turned bullish on thursday, we had some good support re-tests on friday. Tokyo only made it to 822, well, not even Tokyo, it was New Zealand who did the re-test, Tokyo didn’t even go below 830 initially. Then London did another attempt of a drop and could only manage to go towards 816 and finally, both London and NY combined did manage 814. All these previous numbers caused bullish spikes, the stronger the session, the higher the spike. London fix was the biggest, of course. What does this tell us? It could mean that EU is preparing for a big bullish move! BUT, there is still a possibility to go lower, so we need to watch the current support zones early next week. Maybe we won’t even re-test the ones from friday, maybe we will re-test even the weekly support at 765 and then drop below. But the higher we stay stuck, the bigger the probability of a big bullish move. The key is that dollar index won’t manage to stay above 100 and EU below 800, because if they do, more downward pressure is coming. If they don’t, EU bulls will slaughter bears next week!
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