When you do technical analysis the one thing they teach you is that " Only Price pays"
Truly when Price is moving up or down ,it pays to stop everything in your analysis and just listen to it's message. Price movements are heavily dictated by liquidity and when liquidity starts gushing in through the door, you just have to make way for it.
The past week has seen a renewed pledge by Global bankers to get more liquidity into the system and equity markets have celebrated the world over.
Mario Draghi's bond purchase plan for the embattled European region is a game changer and may be looked back as the end of the financial crisis in Europe. The Euro has been celebrating ever since the " will do whatever it takes " announcement much ahead of last week's meet and is on course to hit the the 1.30 mark by this month end.
Major news today would be IIP data expected to improve sharply and the German court ruling on whether to grant temporary injunctions against Germanys ratification of Europe's new bailout fund, the European Stability Mechanism (ESM), and on the "fiscal compact," which raises collective enforcement of EU budget rules.
Many expect an approval which will keep the rally intact.
The IIP is expected at 11.00 am today and the German courts decision at 1.30 pm.
According to Reuters there is a 60 % chance of QE3 being announced at Thursday's FOMC meet. But despite the disappointing Non-Farm payrolls reading and falling unemployment rate, improving services ISM and rising retail sales are among the recent economic data standing against a September QE3. The FED may just give another twist to it's statement on interest rates whilst keeping the door open for QE3 in the future.
The lack of any QE3 on Thurs may lead to a temporary pullback in stocks and precious metals before a rebound later on Friday as the market figures that QE3 is simply an eventuality.
Amongst other news at Vtrender we are happy to have launched our new Quant service which has delivered two profitable setups for us in the past week and a half. These trades would have a frequency of 1- 2 every week and are prepared to take the risk out of the market environment.. We will strive to give you Market beating returns and half the risk. That's our motto for the service
If you are interested in a trial, send us am email at vtrender@gmail.com.
I will be back with charts and analysis later.