The GBP/USD pair fell during the session on Friday, as we continue to try to grind our way towards the 1.55 level. That being the case, the market looks as if it is going to be very difficult to deal with in the meantime, but we believe that near the 1.55 level you can start buying puts as the market should then grind its way back down to the 1.53 handle. Ultimately, this is going to be short-term trading only, as the market is so noisy.
The S&P 500 struggled a little bit at the 2100 level yet again on Friday, and as a result we believe that buying short-term calls on short-term charts will be the way to go. Ultimately, we feel this market does break out and above the 2100 level in order to continue its next leg higher, but any and we believe that buying calls is the only way you can go. There is no way to buy puts at this point time because there’s far too much in the way of support underneath.
The DAX shot higher during the course of the session on Friday, breaking above the €11,000 level finally. That being the case, the market looks as if the sellers are going to step into the market and push at that point. The shooting star of course is very negative, but ultimately we believe that the DAX will continue to go higher based upon ECB liquidity measures. With that, we are simply looking for supportive candles below to start buying calls.