Looking at the Wednesday session, Janet Yellen testifies in front of Congress. Because of this, we could see a bit of volatility in the US stock markets, which of course will be the main focus because of her testimony. With that being said, the S&P 500 broke out during the session on Tuesday, meaning that we should continue to see call buying opportunities again and again. We have no interest in buying puts as the S&P 500 should continue to go towards the 2200 level. The 2100 level now should be supportive.
Silver markets found a bit of support near the $16.00 level, and that of course is the beginning of significant support all the way down to the $15.50 handle. Because of this, we are looking for supportive action in order to serve buying calls again, and if we can get above the $16.50 level is a sign that we are going to go much higher. We need either see that supportive candle below, or the breakout above the $16.50 level in order to serve buying calls, but we have no interest whatsoever in buying puts.
The EUR/USD pair continues to find support below the 1.13 handle, as we bounced slightly during the session on Tuesday. However, if we break out to the upside we would have to think that there is a significant amount of resistance all the way up to the 1.1650 handle. Any type of resistant candle above houses buying puts but we are absolutely against using calls to play this market as the downtrend has been so strong and should continue to be the case for the foreseeable future. We believe that the EUR/USD pair will trade in a tight range going forward, but ultimately has a downward bias.
