The US Federal Reserve disappointed markets by not announcing any further easing at its meeting, so no more QE yet! Nor did it change the exceptionally low Federal Funds Rate Guidance from at least through to late 2014 and there was even some talk of an extension into 2015. But the Fed did acknowledge the deceleration in economic activity and said it will provide additional accommodation, as needed, to promote a stronger economic recovery. This is a slight tweak from being prepared to take further action, as appropriate, to promote a stronger economic recovery, as indicated in the June statement. So the Fed appears on track to announce further QE in September! The FOMC announcement turned what had been a positive US session into a negative one. In Europe the manufacturing PMI’s were dismal, as expected, but surprisingly the UK PMI was much worse than anticipated, adding pressure for the MPC to take further action.

Later today, all eyes will be on the BOE and ECB meetings with markets looking for the ECB to do whatever it takes to ease the debt crisis and boost confidence in the Eurozone. At 1.30 pm we have the Weekly Jobless No’s from the US which will be watched closely ahead of Non Farm Payrolls tomorrow.

Sept S&P 500

Yet another rally ahead of an important meeting! As I have been saying for the last 2 years, everytime we have a major announcement or meeting, the market rallies ahead of the announcement and you have to go flat at least 10 minutes before the event in order to reduce your risk. It should have sold off more but it didn’t as the Fed have kept the everyone guessing in relation to the possibility of QE in September and the fact we have the ECB meeting today. It makes it extremely difficult to be short despite the very weak economic numbers that are emerging almost every day. I am still flat as I want to see what the ECB does ahead of Non Farm Payrolls tomorrow. There are times when its safer to do nothing and this is one of those times. Today, my plan is to hold fire but if the S&P drops down to 1350 I will be a buyer with a 1343 stop.

EURO/USD

I am still flat the Euro and today I will look to go long from 1.2190/1.2210 with a 1.2155 stop. I really believe the ECB have to do something today given how weak the Economic news is. Again after the announcement we have the press conference later at 1.30pm which will give a proper insight to how the ECB is going to handle this crisis.

EURO/JPY

The Euro/JPY dropped down to my buy zone and I am long at .9570. This is my only position at the moment and I will leave my stop at .9530. If we rally back to the .9630/.9650 I will look to take profit in this area.

Silver

Silver did not work out for me yesterday and I was stopped out of my 28.00 long at 27.65 and I am now flat. If Silver trades back to the 26.50/26.90 area I will be a small buyer with a 26.30 stop.

Sept BUND

The Bund is getting near interesting levels again and I will look to go long from 142.70/143.00 with a 142.50 stop. If I am taken long I will look to take profit from 143.60/143.90 as the 144.00 is critical resistance.