The QE2 has been supporting markets a lot when it started in Nov 2010. The global markets made a fresh after that. The program is going to end in June 2011 and probably that's why the global markets are changing their trends.
In next few posts I will try to explore how to benefit from the upcoming macro event.
First lets see define the timelines
QE1 Start : Jan 2009 QE1 End : Mar 2010
Ben Speech on QE2 Aug 2010 --> Indication on starting another round of QE.
QE2 Start : Nov 2010 QE2 End: June 2011
Everyone knows that the QE1 ended a bear phase and started bull run and most of global markets made highs in Jan 2010.
Most of the markets struggled during the QE1 end to start of QE2 period.
Attached is the chart with SPX and EEM with timelines.
The above chart clearly shows all the trend for US and Emerging markets.
Worth noticing is the markets show jitters 1 month before end of QE as it is unwinding of trades based on QE.
And I feel that the recent free fall in commodities was more or less attributed to end of QE2.
The increase of margins just added fuel to fire. The effect is clearly visible on CRB index charts.
So there is increased probability that when Fed withdraws the "Helicopter Printing Press" (Visually) then we can see a range market for quite some time.
In next few posts I will try to explore how to benefit from the upcoming macro event.
First lets see define the timelines
QE1 Start : Jan 2009 QE1 End : Mar 2010
Ben Speech on QE2 Aug 2010 --> Indication on starting another round of QE.
QE2 Start : Nov 2010 QE2 End: June 2011
Everyone knows that the QE1 ended a bear phase and started bull run and most of global markets made highs in Jan 2010.
Most of the markets struggled during the QE1 end to start of QE2 period.
Attached is the chart with SPX and EEM with timelines.
The above chart clearly shows all the trend for US and Emerging markets.
Worth noticing is the markets show jitters 1 month before end of QE as it is unwinding of trades based on QE.
And I feel that the recent free fall in commodities was more or less attributed to end of QE2.
The increase of margins just added fuel to fire. The effect is clearly visible on CRB index charts.
So there is increased probability that when Fed withdraws the "Helicopter Printing Press" (Visually) then we can see a range market for quite some time.
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