The market broke out of its consolidation triangle, but the move was not rejected like I thought it might be. The action was based on genuine strength, based on a strong reaction to Draghi's monetary policy statement and to positive surprises on Jobless claims and ISM manufacturing data. The almost 30 point move up on the ES without any sign of selling pretty much confirms the breakout to the upside. Yes, price needs to hold up here and see a higher close to officially confirm the move, but I think it is safe to assume that will be the case. We will likely get some sell opportunities in September, but I'm not expecting as much of a downturn opportunity as I had previously. Following yesterday's move, I expect the markets have further upside ahead of them leading up to the FOMC meeting next Wednesday and Thursday.
Gold has jumped $30+ /ounce following the employment numbers suggesting the speculators are putting higher odds on the possibility the Fed will announce some sort of easing measures following next week's meeting. Its funny that the QE speculation never dies. It has been talked about all summer and though we never get it, the market continues its rise nonetheless. I don't believe we get more QE after next week's meeting either, but more on that later...
Bias toward buying the dips is back on
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