Jackson Hole Week

A shorter post than usual today as I had a hospital appointment this morning and have started late. The appointment went very well and I'm cleared both to drive and to walk without a removable cast or crutches now, which is great.

Ben Bernanke will be making a statement at Jackson Hole on Friday and rumors of QE3 have lifted equities strongly overnight. We might well see a strong rally on expectations that the Fed will print more money to boost asset prices, though that wouldn't be easy given inflation levels in the US and implacable opposition in Congress. We'll see.

In the short term ES has broken up from the declining channel from the most recent high, and the prospects for more upside look ok here. ES is finding resistance in the 1145 area at the moment and an IHS may well be forming with a neckline there, though there is an alternative neckline somewhat higher at 1154. if this continues to form then I'd expect a retracement back into the 1120s to form the right shoulder and we might therefore see a gap fill if that happens:

Oil has made a higher low and may have formed a small rising channel that could deliver a bounce into declining wedge resistance in the 90s:

Silver's looking very interesting this morning as I now have what looks like a rising channel, at the top of which silver has made a double-top overnight on negative 60min RSI divergence. A retest of 40 looks very much on the cards here:

USD has been consolidating in a range between 73.5 and 76.5 for three months now. The obvious next move would seem to be back to the 76.5 area unless 73.5 support is going to break. If it does break then a new low for USD isn't far below:

Short term the overall picture for equities is looking more bullish this morning, and I'm expecting more upside this week. We might see a sharp retracement of some of the overnight gains before we see that though.