Continued intervention by the Fed helped caused another narrow-range short-covering choppy uptrend on Thursday. The Fed is going to continue to manipulate the markets, pushing equities up (and pushing gold down), as we get closer to the September FOMC meeting where they would likely announce another form of liquidity injection into the global financial system, many suspect that it is going to be an "Operation Twist 2".
As such, if the Fed continue to succeed in pushing the market up, traders who are short will continue to get squeezed, hence uptrend will continue albeit small range and choppy. Will the fed continue to be successful only time will tell, but as long as any pullback down does not violate important support zones the current uptrend will continue.
We must also keep in mind that when fiat currencies finally collapse (hyperinflation) stock markets will rocket up into the stratosphere as we saw recently in Zimbabwe.
For Friday my Line-in-the-Sand is 2275.
- Bullish above 2275 targeting 2300-2310
- Bearish below 2275, implies the market needs a pullback down, targeting 2250 then 2200
