This page has been archived and commenting is disabled.

Market Responds To Market Response To Coy Fed (And Goldman's Take)

Tyler Durden's picture





 

It appears that more even than the Fed, the market, being a perfectly insane reflexive device, saw the 0.1% knee-jerk drop in stocks, and took that as a far greater THE NEW QE™ catalyst than anything just released by the Fed's printer. Gold is now higher than before the FOMC statement and QE-favorites Energy and Financials are notably outperforming.

And here is Goldman's take:

BOTTOM LINE: The statement following today’s FOMC meeting was largely unchanged from March and a touch more positive than we expected. No changes to the forward guidance and only minor changes to the description of the economy. Updated economic forecasts and Chairman Bernanke’s press conference scheduled for 2:00pm and 2:15pm, respectively.

MAIN POINTS:

  1. The FOMC’s post-meeting statement was little changed from the March meeting, as expected. The committee retained its guidance that the funds rate would likely remain exceptionally low “at least through late 2014”. Unsurprisingly, the committee decided to continue the ongoing Maturity Extension Program (MEP)—the “twist”—and said again that it was prepared to adjust its security holdings “as appropriate to promote a stronger economic recovery in a context of price stability”.
  2. The FOMC made a few small changes to its description of the economic backdrop. First, it removed the phrase that strains in global financial markets “have eased”. Second, the statement said that the unemployment rate “has declined” instead of “has declined notably”, acknowledging the slower pace of decline more recently. Third, it noted that inflation “has picked up somewhat”, mainly due to oil prices. All of these changes were in line with expectations.
  3. The statement included a few additional changes which were slightly more upbeat. It noted “some signs of improvement” in the housing market, before reiterating that the level of activity “remains depressed”. In addition, it said that growth should “pick up gradually” after a few quarters. The latter phrase is consistent with Fed officials existing forecast but a new addition to the statement.
 


- advertisements -

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Wed, 04/25/2012 - 13:18 | Link to Comment Mr Lennon Hendrix
Mr Lennon Hendrix's picture

GOLD IS BAAD!!!!!!!!!!!

Wed, 04/25/2012 - 13:32 | Link to Comment walküre
walküre's picture

Ben needs POG to rise as backdrop to his verbal diarrhea.

He knows, they know that investors are watching gold's reaction to his "speeches". Therefore, his lemmings are told to manipulate the paper price of gold upwards. The impression is that when gold goes up, the Fed is about to do something in terms of printing.

Don't get fooled.

Wed, 04/25/2012 - 13:42 | Link to Comment slaughterer
slaughterer's picture

FWIW, we have been watching the algos sell JPM on strength and buy MS on weakness all day.  

Wed, 04/25/2012 - 13:48 | Link to Comment AllThatGlitters
AllThatGlitters's picture

Yup! On the pre-Fed thread, I suggested silver would reverse the Fed Reaction (really, the dip before it).

Looks like Gold is doing a better job of reversing the silliness than silver:

http://www.pmbull.com/gold-price/

Nevertheless, it could also mean silver has more upside, once we get past the paper shenanigans in COMEX.

 

Wed, 04/25/2012 - 14:54 | Link to Comment Temporalist
Temporalist's picture

And the chart shows two attacks on gold today that were bought up very quickly.  Veird eesnt eet?

Wed, 04/25/2012 - 13:19 | Link to Comment buzzsaw99
buzzsaw99's picture

In Amerikkka stocks sell you!

Wed, 04/25/2012 - 13:19 | Link to Comment Quintus
Quintus's picture

Nonsense.  Absolute nonsense. This market is an absurdity.

Wed, 04/25/2012 - 13:28 | Link to Comment cougar_w
cougar_w's picture

Well actually there is probably nothing wrong with the market as such. However the market since Greenspan has become a second-derivative of the FOMC minutes and a thrid-derivative of itself, so it only looks like nonsense.

Derivates and non-linear properties are like that. Shyte comes at you out of the blue. Bad shyte.

Wed, 04/25/2012 - 13:19 | Link to Comment Bastiat
Bastiat's picture

Gold HOD.  funny.

Wed, 04/25/2012 - 13:29 | Link to Comment cougar_w
cougar_w's picture

Edumacate me: what is HOD?

Wed, 04/25/2012 - 13:45 | Link to Comment SheepDog-One
SheepDog-One's picture

High Of Day?

Wed, 04/25/2012 - 14:38 | Link to Comment cougar_w
cougar_w's picture

Probably. For some reason I was thinking it meant "Hell Out of Dodge"

The bunker mentality around here, must be getting to me.

Wed, 04/25/2012 - 13:20 | Link to Comment xtop23
xtop23's picture

 Bring in the dancing bears this market is a fucking joke

Wed, 04/25/2012 - 14:03 | Link to Comment mt paul
mt paul's picture

pole dancing

polar bears ..?

Wed, 04/25/2012 - 13:20 | Link to Comment fonzannoon
fonzannoon's picture

Dennis Gartman has been long gold since 1:03pm and takes offense to anyone misremembering that he was short gold at 12:53pm

Wed, 04/25/2012 - 13:33 | Link to Comment Tyler Durden
Tyler Durden's picture

... OF gold

... in Vietnam Dong

Wed, 04/25/2012 - 13:20 | Link to Comment dereksatkinson
dereksatkinson's picture

GDX:GLD ratio are signaling a change in sentiment.  This correction is very similar to the one in 2005.  The HUI more than doubled a year after it bottomed.

Wed, 04/25/2012 - 13:21 | Link to Comment SHEEPFUKKER
SHEEPFUKKER's picture

Another day of watching western gold go to eastern vaults.  

Wed, 04/25/2012 - 14:05 | Link to Comment mt paul
mt paul's picture

northern vaults also..

Wed, 04/25/2012 - 13:22 | Link to Comment Cursive
Cursive's picture

Algos gone wild.  If a<c, then buy...

Wed, 04/25/2012 - 13:22 | Link to Comment VonManstein
VonManstein's picture

the market is coming to its senses.. algo did the selling now people with brains are buying the dip.

buy this dip.. and buy the next dip.. dont think there will be many more.

this was an epic failure on part of teh cartel (tempting fate)

Wed, 04/25/2012 - 13:23 | Link to Comment Al Huxley
Al Huxley's picture

It's almost as if the markets are being manipulated to provoke knee-jerk responses.

Wed, 04/25/2012 - 13:32 | Link to Comment Cdad
Cdad's picture

It is.  Because "investors" are gone, the only nominal buyer of equities are algorithmic in nature.  As such, large banks mark them up to get the dumbest algorithm in the room buying from them...at higher prices.

The market is as long gone as investors.  Cdad sending out a golf clap for Wall Street...managing to juice equities world wide on the back of one earnings report.  Bravo.

Nanex covers this phenomena daily, noting how quote stuffing [no need for actual trades even] is used to get the HFT moving.

Wed, 04/25/2012 - 13:50 | Link to Comment Al Huxley
Al Huxley's picture

I know, I was being sarcastic.  The manipulation gets more blatant by the day, either due to an increased sense of desperation on the part of the manipulators, or more likely, as a result of an increased sense of invulnerability on their part - sort of a 'fuck you, what you going to do about it?' attitude they're demonstrating more and more aggressively.  Occurring across the board - markets, tax collection agencies, 'security' agencies - all just getting increasingly brazen in flaunting any vestige of law and order under the banner of 'fuck you, what you going to do about it?'.

Wed, 04/25/2012 - 13:25 | Link to Comment homer8043
homer8043's picture

Now we wait to see if dots move left or right. Fun!

Wed, 04/25/2012 - 13:25 | Link to Comment nobusiness
nobusiness's picture

Once again I'm confused.  Is no QE 3 in the near future good or bad???  Market up after no new goodies for the banks?  What gives?

Wed, 04/25/2012 - 13:27 | Link to Comment buzzsaw99
buzzsaw99's picture

If unemployment stays high then that will justify more banker bonuses.

Wed, 04/25/2012 - 13:30 | Link to Comment Cdad
Cdad's picture

Is no QE 3 in the near future good or bad???

Funny, isn't it?  The more QE is not given explicitly, the harder The Street searches for QE.  If not during the FOMC meeting, then in the press conference.  If not in the press conference, then surely in the next meeting.

These are the brain trusts in charge of the global economy.

Wed, 04/25/2012 - 13:34 | Link to Comment SheepDog-One
SheepDog-One's picture

Like a dealer telling the crackhead he's out of crack....'NAW man come on I know you got a crack rock in one of these pockets man I'm sure of it'!

Wed, 04/25/2012 - 13:47 | Link to Comment GlenD
GlenD's picture

 

 

If_US_doesn't_Print:

default = True;

USD = 0;

petrodollar = 0;

troops_in_foreign_lands = SOS;

EXIT;

 

If_US_does_Print:

USD = USD / 2;

GOLD = ZOOM;

SILVER = ZOOM;

WAIT: 1 YEAR;

GOTO If_US_doesn't_Print

Wed, 04/25/2012 - 13:27 | Link to Comment Chupacabra-322
Chupacabra-322's picture

Gold Biatches !!!

Wed, 04/25/2012 - 13:41 | Link to Comment SheepDog-One
SheepDog-One's picture

Markets unchanged now from the futures pumped open. Big deal.

Wed, 04/25/2012 - 13:32 | Link to Comment DollarDive
DollarDive's picture

From the Desk of B. Bernanke
Federal Resrve Bank
Washington, DC

ATTN : NY FED

Please execute the following transactions :

1. Please BUY$20bb of ES Futures at 4:07pm EST
2. Please sell $2T of Eur/USD at 6pm EST and Buy $4T of AUD.USD at 9:00pm EST
3. Please sell  $10B Derivatives against our Maiden Lane II holdings
4. Please contact Goldman and JPM so they can alert other Primary Dealers

Have a great day,

BB

 

Wed, 04/25/2012 - 13:33 | Link to Comment defencev
defencev's picture

Actually, what is going on may be surprising only for those who are systematically brainwashed by this website. US economy had bottomed and now slowly improving (Marc Faber not me). Housing probably bottomed (Bloomberg not me). We may expect stabilization in stock market. The crash will come later with inevitably rising inflation and inability of Fed to rise the rates due to the huge US debt. This is not the first time I am making these points on this website but nobody is listening obsessed with their own paranoya. In this environment QE is out of question.

Wed, 04/25/2012 - 13:40 | Link to Comment SheepDog-One
SheepDog-One's picture

Like telling a rock-bottomed out crackhead to just take these vitamin pills and drink a Keva lemon grass smoothie. LOL get real man, this 'market' was built on free money from a firehose to pump it back to near all-time bubble highs again, and your idea is it can just 'clean up' and be all fine again from here on out? Come on, man.

Wed, 04/25/2012 - 13:37 | Link to Comment magpie
magpie's picture

You just have to look who is printing instead of the Fed.

Wed, 04/25/2012 - 13:40 | Link to Comment xtop23
xtop23's picture

Theyre already doing QE.

Nobody with any sense actually believes they will launch "outright" QE until after the election unless there is a total implosion that gives them the political cover to intiate it.

Wed, 04/25/2012 - 13:43 | Link to Comment SheepDog-One
SheepDog-One's picture

Then it will show up in $5 gas by election time....and good luck with that in an election to whoever thinks theyll get re-elected.

Wed, 04/25/2012 - 13:54 | Link to Comment xtop23
xtop23's picture

I think TPTB want Obama out regardless. He's been a useful idiot but Romney will line their pockets even deeper.

Syria here we come !

Wed, 04/25/2012 - 13:46 | Link to Comment walküre
walküre's picture

We may expect stabilization in stock market

Like watching paint dry on the surface. Underneath the paint is not taking and it's peeling.

The crash will come later with inevitably rising inflation and inability of Fed to rise the rates due to the huge US debt.

The crash is well underway. Look at a few individual stocks that aren't part of the propaganda ploy. Those stocks relying on real investors / buyers are in a steady decline. Investors have been herded into dividend paying blue chips etc. Those companies are catching some interest.

Some blue chips however are selling off because even with a daily fresh coat of paint and dumb money, the big boyz are selling into strength.

By the way. Who is washing your brain?

Wed, 04/25/2012 - 14:03 | Link to Comment defencev
defencev's picture

 Why do you think I have to listen to fuckung idiots like you? The crash mean US Dollar crash. I do not expect crash in stock market (so does Marc Faber who recommends partial allocation into stocks). I am making money both in stocks and real estate unlike fucking idiots worshipping this worthless from investment standpoint website.

Wed, 04/25/2012 - 14:12 | Link to Comment walküre
walküre's picture

You still here? I thought you'd be back to watching CNBC by now?

Wed, 04/25/2012 - 13:40 | Link to Comment DavidC
DavidC's picture

Meanwhile, even Apple acknowledged things might not be so good in the second half and retail sales were a massive miss....yup, things are getting better.

DavidC

Wed, 04/25/2012 - 15:08 | Link to Comment earleflorida
earleflorida's picture

crying wolf [ultra conservative forecast?] will catch-up to the [on a mediocre report] best, when the fleet footed stumble over a tortoise mistaken for a stone 

Wed, 04/25/2012 - 13:41 | Link to Comment williambanzai7
williambanzai7's picture

SILLY BEN

Wed, 04/25/2012 - 13:50 | Link to Comment DollarDive
DollarDive's picture

Minister of Silly Walks

http://youtu.be/IqhlQfXUk7w

Wed, 04/25/2012 - 13:55 | Link to Comment Nobody For President
Nobody For President's picture

"He who knows. speaks not.

"He who speaks, knows not."

 

Banzai doesn't say a word - just posts a little picture and fucking nails the FOMC statement.

Wed, 04/25/2012 - 13:42 | Link to Comment Black Forest
Black Forest's picture

Gold is now higher than before the FOMC statement

Tyler, the HFT robots have seen your graph

http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2012...

and decided to take immediate action.

 

Wed, 04/25/2012 - 13:48 | Link to Comment MFL8240
MFL8240's picture

the fedearl consters said they see gradual improvment in the economy?  Well, the past few months has shown the most dramatic deterioration of economic fundamentals in the US and with an economics MBA I am wodering what the hell they are talking about.  Do they have a crystal ball that they can share with us idiots??

Wed, 04/25/2012 - 13:51 | Link to Comment Vince Clortho
Vince Clortho's picture

Its just a question of how heavy do you weight the shares price of AAPL.

Wed, 04/25/2012 - 13:57 | Link to Comment Zero Debt
Zero Debt's picture

Strong buying appears below the four-year equidistant channel starting from 2008 around 1,625-1,630. Got to be a nightmare to try to short it below 1,630. Is it those Russians buying the dips? Still, gold cannot seem to clear 1,650 with gusto or even hold on to 1,645. What one want to see now is to squeeze all those sell stops at 1,645, trigger some covering up to 1,650 and then trigger buying, perhaps even fire off some buy stops above 1,650. From 1,650 there is not much on the chart in terms of resistance preventing it to run to 1,680 where it faces stronger resistance. The Fed minutes on 26 April 2012 were a dud and did not really move the price, however it did add some volatility to the price although a range of 30 usd is by no means unusual.

The upper range of the 2008 equidistant channel is now near 1,840. Should the cycle from year-end 2011 to topping out at 29 Feb 2012 repeat itself, which would rhyme with the waves topping at 9 Aug 2011 and 8 Nov 2011, it would imply a run to 1,900 usd/oz by the end of June 2012, which is feasible without violating the upper channel bound. 200 day SMA remains around 1,557. It does looks like gold wants to stay at least 50 usd above it, which provides additional support technically at 1,600, in addition to the emergence of significant buying near 1,620, which makes the case for sub-1,550 gold a rather weak one in the absence of some form of Lehman-esque calamity. Gold still remains below the 50 day SMA and may need 2 weeks or more to break out above it should the price continue to oscillate around support at 1,640.

Wed, 04/25/2012 - 14:31 | Link to Comment adr
adr's picture

When is the market going to realize there isn't going to be another outright QE episode?

These fucking doped up brokers just won't give up. Bernanke must be laughing his ass off every day.

"I don't even have to turn on the printer, just them thinking I will is enough to goose the market. Fuck, who would have thought, hahahahah."

The entire rally was on the back of the idea the Fed would buy more worthless assets, giving away more free money that could be used to push prices higher. The problem is there is nobody outside the pushers willing to pay the higher price.

IN normal circumstances you would call that selling a product nobody wants, and you'd go broke in no time.

I don't think there is a sane person left that believes in this market.

Wed, 04/25/2012 - 14:36 | Link to Comment GernB
GernB's picture

I think we are now seing the response to the response to the response to a coy fed as the S&P has almost immediately come off of it's highest levels.

Wed, 04/25/2012 - 15:06 | Link to Comment GS-DickinDaMuppets
GS-DickinDaMuppets's picture

The Boyz (TPTB) have instructed Benny to keep the Muppets "entertained" and distracted from the "real truth", because they are not through scr3wing them out of all their hard earned money by inflating the dollar to the MOON... (Alice).

There is NO MARKETS, only politically controlled retail outlets run like a magic show to convince the Muppets into selling their hard assets (PM) and buying balloon-bloated stocks so the Boyz can get out before the "Big One"

http://www.youtube.com/watch?v=ol9EEa6MNHA  (1:36)

Protect what you have the "Night Cometh

...doing GOD's work....GS-DickinDaMuppets

Wed, 04/25/2012 - 16:30 | Link to Comment Stackers
Stackers's picture

LOL, first rule I learned in trading. The first reaction to any news annoucement is always the wrong reaction.

Do NOT follow this link or you will be banned from the site!