During the session on Monday, we only have a couple of housing numbers coming out of the United States, so it should be a fairly technical day. With that being the case, the market looks as if it is ready to continue what we have seen on Friday, and therefore we feel that the US dollar will continue to strengthen in general.

The US dollar strengthening will more than likely work against most commodities. However, keep in mind that silver and gold both are in consolidation that is fairly stringent, so any downside in both of these markets is probably somewhat limited. If you’re looking to buy puts, you will have to do it off at short-term charts.

The stock market should continue to go higher overall, especially European stock markets as the value of the Euro continues to fall. Because of this we like the DAX, the CAC, and even peripheral Europe at this point in time. We believe the pullbacks offer value that you can start buying calls on, and then eventually the indices around the European Union will continue to strengthen.

Ultimately, we do believe that US dollar strength will probably be the theme for the next several sessions, so therefore we are not interested in buying any position that puts us at odds with that thought process. Most of your trades will probably be found in the Forex markets over the next couple of trading sessions.