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Two Ways: What Will the Fed Do Next?

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Strengthen your portfolio in good times and bad.

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Fed Day

The Federal Open Market Committee (FOMC) will release a statement on the federal funds rate later this afternoon. But with the target rate -- for all intents and purposes -- already at zero, traders won't really be concerned with the direction. Instead, investors will comb through the statement for clues as to what other actions the Fed may take, such as quantitative easing and other strategies aimed at increasing the money supply.

In its previous 2 meetings, the Fed hinted at buying longer-term Treasury securities if it proved beneficial in improving the credit markets.

For more on the economy, see Professor John Mauldin's Tectonic Shift in Currency Markets.

From the Bull Pen: Is there increasing interest in gold stocks by the smart money? One can look to Newmont Mining (NEM). One option could be buying on a pullback to $35. A sell stop can be set 2% below that level.

From the Bear Cave: As Professor Lewis mentioned yesterday, those long the Ultrashort 20 Plus Treasury ETF (TBT) should exercise caution. One option is to take profits and return with TBT near $45. If and when.

Quick Check Around the World

Asian trading closed with the Hang Seng 1.86%, Nikkei 0.29%, India 1.27%, Taiwan 0.12% and Shanghai 0.24%.

Glancing towards Europe, we see the CAC 0.65%, DAX 1.14%, FTSE -0.44%

As of 8:00 AM EST, S&P Futures are trading -4 to 770, and Nasdaq futures are -2 to 1188.

A Look At Commodities

Crude oil is trading -0.69 to 48.47. Gold is -5.00 to 911.80. Silver is -0.30 to 12.640, and copper +0.80 to 173.20.

The dollar index is +0.015 to 87.3600.

On the Radar

Economics

07:00 MBA Mortgage Applications
08:30 Consumer Price Index (MoM & YoY) 0.3%, 0.0%
08:30 CPI Ex Food and Energy (MoM & YoY) 0.1%, 1.7%
08:30 CPI Core Index
08:30 Current Account Balance
02:15 FOMC Rate Decision

Click here for the full trading radar.

Let's get over the hump. Good luck, Minyans.

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No positions in stocks mentioned.

The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

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