Fed Doesn't Disappoint But Will Dollar Weakness Continue
Littlefish FX | Sep 13, 2012 06:13PM ET
Anticipation is finally over and the markets, well they aren't quite as pleased as we thought they might be, maybe technicals are weighing on them too much, we did spike higher today but it did tail off. Maybe I am just a little to pessimistic possibly they will push higher still (they will if all retail traders are short) but we seem to be hitting technicals a little too perfectly.
So the Fed announced QE3 to steal Kathy Lien's commentary "$40 billion worth of mortgage-backed securities on a monthly basis with no expiration date, there’s no going back as the floodgates are officially open". (Definitely an individual you should follow and read).
With regards to our positions on the announcement of QE3 we closed all remaining open positions to book the profit, we then looked for opportunities out of the aftermath, we think the Fed really pushed hard this time (and possibly won the election for Obama), that said everything is pointing to an over bouught situation and although I think we can go higher by year end, it feels like we are now due a pull back in some form,
The good thing about risk events such as today is that it normally gives us a good indication to market momentum ad some nice entry singnals.
EURUSD
Given the QE hopes today the Euro pushed higher, I do wonder how long for though and therefore our strategy remains the same, to look for buying opportunities on a pull back. We now sit at the 1.3 level which many have called for as a level to sell from; I would rather wait for a good entry signal and therefore Bearish signals above 1.3 0 on a daily close or Bullish signals towards support then I will look to enter the market.
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