Looking at the Monday session, there is almost nothing as far as economic announcements are concerned, and quite frankly the biggest market moving event will more than likely be the fact that it is Martin Luther King Jr.’s birthday in the United States, closing the markets. Because of this, this will be a very Eurocentric day in our opinion.
That being said, the EUR/USD pair has completely broken down, testing the 1.15 level. That being the case, it appears that the market will more than likely bounce a little bit from this area, but that should only end up being a put buying opportunity. After all, the downtrend is most certainly strong, and we have broken down well below significant support in the region of the 1.18 handle. Nonetheless, 1.15 is a large round number, so it will more than likely be respected.
euro/usd
Looking at the DAX, we have broken out significantly during the session, clearing the €10,100 level, which was the most recent high. That being the case, the market looks as if it is ready to continue to go much higher and start the next leg up. We are buying short-term pullbacks in order to buy calls and recognize that it is the way to go going forward.
Silver markets of broken out, and it should be heading to the $18 level over the next couple of sessions. Any type of pullback should offer a nice call buying opportunity as there should be plenty of support below as the market certainly has shown real strength to the upside at this point in time.