Looking at the Tuesday session, we see almost nothing to move the markets as far as announcements are concerned. This is the second day in a row that the markets are going to be very quiet as far as news flow is concerned, but that doesn’t mean there won’t be nice setups. There are a couple of markets that we are extraordinarily interested in, and of course we will take a look at those now.
The gold and silver markets both are offering put buying opportunities as they are both in massive decline, and also have quite a bit working against them. After all, the US dollar going higher as it has certainly will do no favors for these markets. We believe that the gold markets are heading to the $1000 level, while the silver markets could be heading as low as $12. With that, we believe every time these markets rally on the short-term chart, it’s offering a put buying opportunity as we can take advantage of “value” in the US dollar.
The EUR/USD pair tells us the same thing, as it continues to fall. The US dollar is by far the most significant currency in the world and the most favored one, so every time the EUR/USD pair tries to rally, we buy puts. We believe that those puts can be bought in till the market goes all the way down to the 1.2050 level, but that of course is a longer-term move.
Looking at the S&P 500, we believe that the market will continue to go higher as it has broken above the 2030 handle. We believe that the market will first get to 2050, and then as high as 2100 given enough time. Look to short-term pullbacks as call buying opportunities and consider them to be value.