Good morning. Happy Thursday. Happy FOMC Day.
The Asian/Pacific markets closed mixed. Malaysia moved up; Australia and China moved down. Europe is currently mostly down. Greece, the Czech Republic, France and Astria are down the most. Futures here in the States point towards a negative open for the cash market.
The dollar is down slightly. Oil is up, copper down. Gold is up, silver down.
The most important FOMC day in a long time is here. It’s not important because something drastically changed in the world. Instead it’s important because for some unknown reason, Wall St. expects QE3 to be announced. If the Fed was truly an independent body which did not listen to Wall St. and made decisions based soley on the stats they have access to, they wouldn’t consider doing QE3. Sure the unemployment rate is still above 8%, but it’s been up here for many months. Why would it suddenly motivate the Fed to do something. Europe is much better shape right now than they were a few months ago. Again, no reason to do anything. If I was the Fed, I’d keep some dry powder for the future. If Wall St. doesn’t like that, too bad. The market has rallied enough in the last three months to take a hit with destroying the progress.
But I don’t have a say-so. Wall St. expects QE3, and that means a couple things. 1) It’s possible the market’s rally was nothing more than traders buying in anticipation of QE3, and once they get it, a “sell the news” scenario will result. 2) Or if Wall St. doesn’t get QE3, there’d be no reason for many traders to hold positions. They, after all, only bought because they felt QE3 was in the pipeline.
The bottom line is be careful right now. The market is in the midst of a nice rally (greater than 10% the last three months). Building gains on top of gains is not easy.
The good news is this is the last of the major market-moving news items. After today – or after this week – the market can get back to being itself. No more dead movement for several days at a time waiting for a single announcement to be made. More after the open.
headlines at Yahoo Finance
headlines at MarketWatch
today’s upgrades/downgrades
this week’s Earnings
this week’s Economic Numbers
0 thoughts on “Before the Open (Sep 13)”
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The Fed will underwhelm Wall Street. The market is likely to spike up then settle back and find a lower equilibrium as it focuses on the fiscal cliff. The rating agencies will likely downgrade, not on facts, but process in Congress – incompetent while setting as a body. It will drive up debt costs which will hurt the economy and reduce maneuver space. No swift moves just an inexorable slip into uncontrolled debt and a failing currency. Watch gold, it is the likely beneficiary. By the way, Europe has a future very similar. Did I mention that I am not hopeful?
firstly the markets–they have been very kind lately
very nice swing clean ,no whipsaw moves lately,but to see that you have to be a daytrader on a 5 minute chart–some times a range trade from one end of the previouse days range to the otherside sometimes lasting for days, followed by impulsive moves
all very tradeable but only to the fun loving gamblers eyes of a daytrader with live futureistic indicators
the definition of a tech analysist—one who follows mr hindsight on a chart that looks backwards–i could waffle on about what is a insto trader ,but wont
now to my rant about the fed
the fed is a private,corporation institution created in the early 1900’s and owned by the banks to control the govt
today i expect a qe3 but not what many expect–it could be as little as 100 billion with more to follow and it may not bond buying,but rather mortgage buying to help the banks with their invisible balance sheets that are under the counter
remember banks are still hiding all their bad debts thanks to pollie barnie franks back in 2008
the dax and europe may have peaked –dax at 7400 even and ftse at 5800
remember the quad witches and derivities control the markets
most markets have peaked for this quarter some but to be pushed a little higher on no vol
—-an insto trick—-
are the instos getting set for the financial cliff with secret bets to the down as retailers and mutuals take the up