Volatility continues to cool

Whilst equities saw minor swings across the day, the VIX continued to broadly cool, settling lower for the third consecutive day, -5.2% @ 18.85. Near term 'best guess', is for a break upward in equities, which should see VIX continue a journey to the low teens into February.


VIX'daily3

Summary

Little to add.

On balance.. unless Draghi bizarrely disappoints tomorrow morning.... equities look set to climb.... with VIX melting lower into the coming weekend.. if not all the way into early February
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more later... on the indexes

Closing Brief

It was another day of moderate swings for US equities (sp' range 2012/38), settling +9pts @ 2032. The two leaders - Trans/R2K, settled +0.5% and -0.3% respectively. Near term outlook is entirely dependent on whether the ECB will spool up the printers enough to 'inspire' confidence.


sp'60min

Summary

... and a rather quiet Wednesday comes to a close.
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So... its now a case of whether Draghi disappoints... or inspires.

Either we jump >sp'2035 tomorrow... breaking trend-resistance... or it'll unravel... at least down to the 1960s where the 200dma is lurking.

Best guess... .we go UP.
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the usual bits and pieces across the evening... to wrap up the day

3pm update - an hour of chop... ahead of the ECB

US equities look set for minor chop into the close.. ahead of the rather important Thursday morning ECB announcement. Market is expecting €50bn a month QE... Mr Draghi needs to at least meet that expectation... or market will drop swiftly to the 200dma in the sp'1960s.


sp'60min

Summary

Suffice to say... choppy....

Best guess... QE...600/700bn annually.... which should be enough to maintain the current monthly gains for the EU indexes.

Few seem to consider it, but much of that printed money will be converted from euros to USD... pushing USD UP... along with the US equity market (where else would the money be spent?).
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*it should be kept in mind, the bulls only need to open moderately higher tomorrow to break declining resistance. A weekly close in the 2060/70s looks very viable.
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back at the close.