Fed chairman made a conditional promise of action. Basically they will do something if growth and unemployment don’t improve. Roll on to Friday’s Non Farm payroll then. Very dissapointing, but the market wasn’t expecting QE from Bernanke as much as action from Draghi today. The market sold off but nothing dramatic.
Step up the ECB. Can they produce sufficeint action today to keep the market in a bull run. Highly unlikely in my view. I’d need to see a definate bond buying programme (with projections/numbers) plus a rate cut, plus announcement of further action to come soon ( ESM etc.).
I think Draghi has gone on a solo run here and can’t deliver. We will see.
Looking at levels 1.2330 top again on the Euro yesterday. 1.2260 1.2190 ahead of Draghi.
S&P 1378 1368
This is a go with the flow trade. However be carefull not to get sucked into a euro rally. If Draghi does something dramatic it will bounce the Euro but should be Euro negative medium term.
Will update on twitter later.