Ongoing uncertainties in Europe are still lingering on global investors’ mindset. Greece news dominates the headlines sending global benchmark indices swinging wildly day to day.
Earlier in the week, the pre ‘vote of confidence’ set global investors in focus. Bulls dominated when Greece overcome the vote of confidence hurdle. With news that the EU and IMF consents to Greece austerity plan, bulls sent the market much higher.
This created a bull trap! Late in the week, speculators worry if the austerity plan were to pass through Greek Parliament scheduled next week? Europe and US stock markets were hit harder when new concerns surfaced within Europe crisis when some Italian bank shares halted trading.
There had been several occasions where bull traps had been laid for the past month or two. Be patient. Be very patient. If you are a “middle or long term” trader, please visit Comparison of major benchmark indices year to date. You decide.
My assumption is that most of the bloggers/audiences are focused on technical analysis, shares and derivatives of Singapore shares. I notice a couple of areas that bloggers do not post. I hope to fill in the vacuum. I like to contribute that investors need to have a global mindset of inter market analysis that sets the market trend in Singapore and Asia.
While some fellow bloggers wonder why markets trends on certain days, I try to fill up the hole. My passion lies in what makes the market trend in a particular pattern. Having found the solution, my next passion is to speculate what contributes to the next trend? This is synchronous to understanding the financial climate.
This brings me back to the title of this post. Many a times, I had mentioned that Europe debt crisis is in focus, primarily on the ‘almost certainty’ of a Greek default. While this had overshadowed other major events, the expiration of QE2 will have an effect on global markets. To familiar with the event, please visit my posts under the ‘Global Financial Crisis’ category. I found the following article notable. Dollar On the Verge of a Market-Wide Rally as QE2 Set to Expiring It discusses on the US dollar, QE2, forex and commodities. Would this have an effect on your investment portfolio?
The following are possible scenarios: Unfolding of QE2 had already begun. It is a quiet signal or an indicator that an ‘earthquake’ is about to happen. The trigger could be an event from the Europe crisis. I would not write off if US or China could trigger a similar event. The potential damage is currently unknown but it’s definitely worth speculating.
The last two paragraphs contribute to my speculation. Market has a tendency to potentially drive southwards. As such, any rebound within this period is a bull trap.
As you all probably know that Greece is very much in focus, there are endless hurdles for Greece to overcome. Over this weekend, if time permits I would blog on the two most important hurdles that really matter. When it is posted, you should be able to click here. I hope this would enlighten you, thus you can strategize on which hurdle to focus on and not get trapped by wild swings.
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