Market Review: ECB Bond Buying On

There may have been some out there who thought that going into today the ECB might disappoint us again, or that if they did anything it might be like someone bringing a knife to a gun fight.  Instead Mario brought a pretty big gun and he is going to use it.  The bond buying will effectively mitigate the risk especially in Spain, Italy, Greece to a lesser degree, and other countries who might be getting into dire straits.

On the news the markets exploded up the Dow was up 1.87%, NASDAQ up 2.17%, and the S&P was up 2.04%.  Some other news that was welcomed was the ADP private sector jobs that were added in August was 201,000 a pretty robust number, analysts were expecting maybe 150,000 added so it was an added surprise.

The ADP is an important foreshadower of Non-Farm Payrolls tomorrow.  Usually if the ADP is up Payrolls tend to follow.  This right now positions the market to move up tomorrow and even into next week.  If you examine the price action over the summer, the SPX essentially created a V bottom, and what was helpful was that throughout the month of August the price action was flat, which when you see a consolidation like that give a good launching pad for price.

With the news today, the S&P broke out to a 4 year high and because of that break out we could see investors start to enter the market. 

The events in the next couple of days, Jobs, FOMC, and other related Europe news could continue, if positive to move the market up.