The Start of Quantitative Tightening October 30Fed will crash the Markets, if they start Quantitative Tightening by end of the November.
Qe3
HOW QUANTITATIVE EASING AFFECTS STOCK MARKET? (UPDATE)Since the beginning of the year FED has gradually lowered its purchases of asset backed securities - QE3. Until it ended the stimulus program on 29th of Oct.
It is interesting, however, to note that the corrections following the FED announcements has been more and more limited. It should be of no surprise as FED sends several upbeat signals to markets that it is not worried about global weakness, low inflation or a wobble in financial markets.
Now when the QE is over the attention is already shifted towards tightening. With current expectations as early as June 2015 there should not be a major tension on the markets for a "considerable time" (using the FED wording).
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CH
First lower low on the ES1! since QE3 started, QE3 ends OctPretty interesting to see the first lower low formed in yesterday’s trade, remember QE3 ends this month.
Keep this in mind when looking at longer term trades.
I'm moving to a cautiously short bias
QE Effects on SP500,USD/JPY,10Y-BONDS,DXYFrom the effects of QE in the past, I want to prepare for the risk in "QE3-end" in the future.
I understand that Falling Stock-Price and Rising Bonds has occurred after "QE-end".
I want to pay attention to lower interest rates after "QE-end".
However, Stock price rise thereafter.
This is the key?
but..
We are confronted at time of "rate hike", this is different from the past two times.
Reaction to this is what about?
Market being aware of "rate hike" will be a support factor for USD.
But, it is also downside risk of US-Stock.
Gold, Silver, Wall Street, OilGold, Silver, Wall Street, Oil
Relative performance at 4 time frames
Note the drastic difference post-2007.
Also note the chaos of 2014
XAUUSD: We are at an overbought level. Correction may startYou are very able to read my previous analysis concerning gold. At 1240 I was saying that there was a little room for a upside move towards 1280 but that the general trend is still on the down side. I do maintain my view that on a long term basis, Gold may see clearly 1180 and even bellow before switching to a long term strategy. With the increase of inflation in the US and the UK, we may see again a certain appetite for XAUUSD. But we are not there yet.
Having said that, at this very moment we are rather in a situation where we are facing an overbought level for Gold on either 1H and 4H. Therefore a correction may be very much on the agenda.
USDJPY: Range trend in favor of USDEverything is said on the chart. One can see my previous analysis published. It looks like we can buy at around 101.5 and sell around 103.5 The swing trade model.....
