FED to mimic the BOJ
The FOMC is prepared to provide additional monetary accommodation through unconventional measures if it proves necessary, especially if the outlook were to deteriorate significantly. ‘Significantly’ is so subjective when you own a depreciating asset like a house, mortgaged to the hilt and are still unemployed. Let’s hope whatever Bernanke and Co. have up their sleeve will have more of an market impact that the BOJ’s foray in easing monetary policy over night.
Technical Picture - Oversold
IBD changed their market outlook from "Uptrend under pressure" to "Market in a Correction" tonight following another distribution day.
As you can see from the S&P e-mini futures chart above, if we can't hold today's low as support, watch out down below. There's not much support between here and the July lows. After hours, Irish debt downgraded from AA to -AA by S&P.

Category: Technical Analysis Tags:
The Calm Before The Storm - Two Weeks Of Lackluster Trading!
Last week, the market backed off from resistance at SPY 113 and the upward momentum from July was stopped dead in its tracks. Economic conditions in China are starting to weaken and that weighed on the market. Conditions in the US are also deteriorating. Back-to-back initial jobless claims numbers were much higher than expected. The four-week moving average is on the rise and that does not bode well for August’s employment report. The Fed lowered its GDP forecast for 2010. In its FOMC statement last week it reiterated that challenging conditions lie ahead.
Weekly Wrap
Here is the weekly recap from Briefing.com:
Additional signs that the strength of the global recovery is waning sparked selling pressure, resulting in sharp losses for the major indices.
The S&P 500 declined four consecutive sessions, with the bulk of this week's loss occurring on Wednesday (-2.8%). Losses were broad-based and trading volume was light, with the NYSE not surpassing 1 million daily shares for the 20th consecutive session.

Category: General Market Tags:
Germany is not the EURs nemesis
It seems that s investors have adopted positions against the EUR not out of conviction about Europe’s economics but instead as a way to hedge bullish stock and other positions. Technically, the EUR would weaken and the dollar would strengthen if global stocks plummet. Last Wed. we witnessed that very scenario. Now that the EUR has dropped three big figures and no momentum to carry on the slide, we sit and wait again? Do we drown out all the noise around us and keep to our convictions? Even the Euro’s GDP numbers this morning has failed to ignite any appetite thus far.
Fed Embarks on Rollover Strategy
As is its practice, the Federal Reserve telegraphed yesterday’s move with a few well-placed journalists. Reports late last week suggested the Fed might take a step back toward easing mode by reinvesting as its bond portfolio reaches maturity. Nobody complained too loudly, so the Fed confirmed the rumors in Tuesday’s announcement. The net result of the rollover strategy is that the Fed’s balance sheet will stay constant rather than gradually shrink. The amounts involved are relatively small, but the symbolism is important. Ben Bernanke is

Category: Fundamental Analysis Tags:
Credit Easing Goodbye – Quantitative Easing Ahoy!
The Federal Open Market Committee (FOMC) has decided to reinvest the proceeds from maturing securities acquired through its $1.25 trillion mortgage-backed security (MBS) purchase program. The proceeds won’t be invested in short-term, but in long-term Treasuries.
Federal Reserve (Fed) Chairman Bernanke has long argued that the MBS program constituted credit easing, not quantitative easing. Credit easing, the argument goes, ought to support the functioning and liquidity in the housing market.

Category: Fundamental Analysis Tags:
Fed: Changes to the June FOMC Statement
After the FOMC announcement yesterday, I posted this comparison of the FOMC statement on FX360.com. I am posting it again in case you want to understand exactly what parts of the statement has been changed. EUR/USD did not follow through on its post FOMC rally is now trading below 1.30. That is the problem with statistical studies, they can right over the long term, but just not the month we are trading!
What A Difference A Day Makes
It seemed the market was generally pleased with yesterday's FOMC statement, as the S&P 500 rallied back from its early lows and closed above the 1120 level for the 7th straight day. But after thinking about it overnight, it seems investors have reached a difference conclusion this morning, and view the Fed's statement as more worrisome.

Category: General Market Tags:
Yen and Dollar remain strong after BOJ policy meeting, FOMC on tap
G10 Advancers and Decliners vs USDJPY 0.07 GBP -0.47 CHF -0.51 EUR -0.52The JPY strengthened versus all 16 major counterparts after the Bank of Japan refrained from taking additional easing steps and amid speculation the Federal Reserve will enact further measures to spur growth. The South Korean won led declines amid Asian currencies after North Korea shot artillery near its border and reports indicated China’s growth is slowing.

Category: Fundamental Analysis Tags:
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