The Friday session will be relatively quite as far as economic announcements are concerned, with the focus being on the United States. The CPI numbers coming out will of course push the stock markets around in the USA, as well as possibly the US dollar. The Michigan Consumer Sentiment Index will possibly move the stock markets as well, but by the time that announcement comes out our suspicion is that the market will probably have settled down.
Looking at the S&P 500, you can see that we continue to find support near the 2000 level, so any time we pullback at this point in time we are looking for work calls to be purchased. Short-term time frames will be used, but ultimately we do believe that this market breaks out and heads towards the 2100 level given enough time.
The EUR/USD pair broke down during the session on Thursday, and now appears set to start another leg lower. With that being the case, we feel that the market will continue to offer put buying opportunities on short-term rallies, but be aware the fact that part of the reason this pair broke down was created artificially by the Swiss National Bank getting involved in the markets and lifting the peg and the EUR/CHF pair. In other words, the market served bit tumultuous at the moment when it comes to the EUR, the USD, and most certainly the CHF.
Silver markets continue to hover just above the $17.00 level, but still have to break above the $17.50 level for us to be impressed. With that being the case, we are not buying calls yet, but would above that level. We think that pullbacks might offer short-term call buying opportunities, but keep in mind that the market is still in a longer-term downtrend and therefore caution should be used.