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Two Ways: Your Move, Bernanke

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Strengthen your portfolio in good times and bad.

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FOMC Day

The Federal Open Market Committee concludes its 2-day meeting today with the release of a statement at 2:15. With interest rates effectively at zero, most aren't expecting any news vis a vis the overnight federal funds target rate. But what market participants are watching for is whether the Fed will boost purchases of Treasuries and mortgage-backed securities.

According to Bloomberg, Chairman Bernanke and his colleagues have been counting on revived growth through the purchase of as much as $1 trillion in asset-backed securities, $1.45 trillion in mortgage debt and $300 billion in long-term Treasuries. However, with some signs of economic recovery in place (i.e. the slowing pace of decline in home prices), some believe the Fed may hold back.

See FOMC: Yellow Metal to Get More Precious? by Professor Lance Lewis for more.

From the Bull Pen: Quite a pickle the Fed finds itself in. With yields on the 10- and 30-year notes climbing to new highs, it may feel forced to push rates down. Equity traders can consider playing the 20+ Year Treasury ETF (TLT) with a 2-point trailing stop.

From the Bear Cave: The best shot for the Ultrashort 20+ Treasury ETF (TBT) may be after the announcement. But one can also look to the Currency Shares Euro ETF(FXE). A sell stop can be set near $129.

Quick Check Around the World

Asian trading closed with the Hang Seng 2.76%, India 3.65%, Shanghai 2.78% and Taiwan 0.31%.

Glancing towards Europe, we see the CAC 1.20%, DAX 0.96%, FTSE 1.17%

As of 7:50 AM EST, S&P Futures are trading +7 to 855.16, and Nasdaq futures are +10 to 1361.92.

A Look at Commodities

Over in commodities, crude oil is trading +0.89 to 50.81 while gold is +3.5 at 897.10 this morning. Silver is +0.120 to 12.520 and copper +4.81 to 196.40.

The dollar index is -0.6950 to 84.6300.

On the Radar

Economics

08:30 GDP-Adv. -4.9
08:30 Chain Deflator Adv. 1.7%
10:35 Crude Inventories
02:15 FOMC Rate Decision

Click here to see the full trading radar.

Happy hump day! Good luck!

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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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