The markets are continuing their march upwards. The DAX has broken out to new bull market highs. It seems investors really like what the Fed is saying.
Will the Fed really go ahead with QE? The November meeting might provide more clues. Meanwhile, we can get some insight from Friday's CPI and retail sales numbers. I expect them to reflect accelerating inflation and an improving economy. This might tilt the balance inside the FOMC towards a more prudent stance.
The put/call ratio is indicating extreme bearishness:
I think yesterday's bears will have to cover at a loss at the open today. The market might fall afterwards and approach yesterday's close. Strength will probably be back after the lunch.
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