Market Sees Some Gains This Week Ahead of Jackson Hole

The beginning of the week did turn out to be a solid buying opportunity as the E-mini S&P 500 Futures traded up almost 80 points off Monday's low. The market has since sold back off yesterday and heading into this morning.

We now await Bernanke's speech at Jackson Hole Wyoming at 10:00am EST.

It will be interesting to see if Bernanke says anything significant enough to influence high volatility in the market. I don't expect there will be any mention of QE3, but only more of the same talk of keeping interest rates low and yield curves low. The Fed has already declared they will keep interest rates low until the middle of 2013 and have also said that "appropriate measures will be taken when they are required". I think things need to get worse before those measures are indeed required.

While I don't expect huge volatility following Bernanke's speech, I will be watching for continued selling into the morning session (high volatility or not). You often will see a fade of the initial reaction following Fed news. There should be an opportunity to buy into support (I will be watching 1130 ES if the market trades that low) as I expect us to finish the day with buying momentum. Lets see how the news streams out of Jackson Hole before predicting where the exact buy entry will be...