During the session on Tuesday, we have several announcements that can move the marketplace. We have the British releasing PPI and CPI numbers, we also have the Germans releasing ZEW Economic Sentiment, and later on we have the Americans releasing CPI numbers. Because of this, we think that there will be quite a bit of motion in the market.
The US dollar should be greatly influential during the day, as a lot of these announcements are more than likely going to be stock market moving events. In addition to announcements, the other thing that moves the stock markets the most is currency. With this, we believe that the stock markets that will be the most interesting will probably be in the United States. However, the German markets will be moved by the ZEW so having said that, it’s very likely that the DAX might be a little bit of an outlier when it comes to the European Union.
We don’t like precious metals, so any rally in gold or silver markets could offer put buying opportunities. At this point in time, precious metals markets continue to be very soft, and with that we have no interest in placing a bullish bet.
The Euro looks as if it is trying to strengthen overall, so we are looking to buy calls on signs of pullbacks. Ultimately, the Euro seems to have been undervalued for some time now, and the markets are starting to realize of this.
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