No MOAR? I think that's what we'll find out Wednesday. Here are three possible reasons the Fed will announce the end of QE on Wednesday. I think they may, for now, stop the program to save face, but liquidity is the sole reason for the market's existence and severe overbought levels today.
Without liquidity supporting the veil (market) that hides the warts and maggots that cover the US economic condition, what may be revealed is something that no one wants to witness. You don't remove the lipstick from the pig. As noted, I do believe there is a significant amount of stealth liquidity that has been used to support the taper period. This stealth QE can and will be used to mask the biggest lie yet, that the Fed's policies have all been successful economy is ready to stand on its own.
I'm thinking #fail will be in order sooner than later. Maybe the stealth QE will be enough to get the market through the election and Christmas season. I still think that January has the potential to be really nasty. The next spill will bring the cries for moar, and the Fed will eventually deliver to save the market one last time.
Remember, QE does not have to happen to please the markets (or so they say - see 2010 and 2011). These days it only takes a rumor, the simple might-promise or hope that QE will come again to keep the markets levitated. See the ECB rumor yesterday that trumped a train wreck of bad news. Their timing is impeccable.
It's gonna be (and has been) all about liquidity. I said it years ago when I first got clued into their game, follow the Fed. How many years have I preached that? It's still their market. This market is all they have between them and complete failure. Don't forget that.
On to the lie -
SPX 30m - Same as yesterday, but worse. Sometime late today or early tomorrow I suspect the leaked directional information will show up in price. I really don't see how an end to QE would be received as a positive. Multiple technical aspects are weighing on any sort of price advancement here. Odds are Tuesday will resemble Monday as we await the Fed.
More to come below.
Have a good day.
GL and GB!