The Minutes for the most recent FOMC meeting can be interpreted to mean heightened possibility of QE3. However, the initial reactions in equities and currency markets do not align with this belief.
The S&P500 for example fell to new lows for the day and week in the hour following the event risk. It is now coming up against the rising trendline from June.
The EUR/USD also slide to new lows, close the 1.22 handle after the minutes maintaining the bearish momentum we had since last Friday after the poor NFP.
Below 1.22, the market continues a bearish outlook toward the 2010 low near 1.19, or maybe the 1.20 psychological barrier above that.
Gold also slid immediately after the release, but really, has not found a direction in recent trading. When you look at the daily chart, you see a sideways market, at range support, maybe with a bit of congestion in lower highs and higher lows.
Fan Yang CMT is a forex trader, analyst, educator and Chief Technical Strategist for FXTimes - provider of rex News, Analysis, Education, Videos, Charts, and other trading resources.
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