With the end of FED's QE3, market are gaining more and more volatility. This does not mean that market will crash, but there will be more heavy movement, and the swing frequency will be bigger.
FED's QE was inhibiting the market, that is why at the highest level of QE3, VIX was as low as 10... There is also more uncertainties in the market, baring in mind the question of the timing to increase the interest rate in the US, as well as the question of whether ECB will be able to reach its 2% inflation target, the political situation and the impact of commodities.
The real big question is whether the market will be able to sustain a growth without any QE and any FED's assistance although there is still cheap money in the market.
NAturally, VIX as well as R2000 indicator are gaining momentum....
FED's QE was inhibiting the market, that is why at the highest level of QE3, VIX was as low as 10... There is also more uncertainties in the market, baring in mind the question of the timing to increase the interest rate in the US, as well as the question of whether ECB will be able to reach its 2% inflation target, the political situation and the impact of commodities.
The real big question is whether the market will be able to sustain a growth without any QE and any FED's assistance although there is still cheap money in the market.
NAturally, VIX as well as R2000 indicator are gaining momentum....
