Is this bounce a bull trap?
00:00, 17 June 2015
· By CMC Markets
By Nicholas Teo, Market Analyst, CMC Markets Singapore
Asian markets are seeing a relief rally this morning on the back of positive futures indications earlier. This follows a reversal of sorts in overnight equity markets.
After starting the day off lower last night, indices in Europe and North America were able to turn things around as the day progressed, building some momentum for the start of today’s Asia Pacific trading.
This follow through, however, may only remain tentative at best as the focus over the next 24 hours will fix firmly onto the US FOMC decision tonight.
Traders will continue to seek an indication of when the central bank could start raising interest rates. At the start of the year, many had thought this could be the lift-off meeting but a soft Q1 pushed the timetable back and no increase is expected this time. Off course, with tonight being a ‘decision night’, anything could happen.
Beyond tonight’s meeting, lots of trigger points for the sell-down to resume remain in the foreground. For one, Greece remains ‘the word’. With PM Tsipras coming out defiant and denouncing the compromise plan laid out by members of the Troika as a “humiliation for our people”, creditors no longer remain on watch but are instead making preparations for the default.
Still, anything can happen!
Source: CMC Markets