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Here we go again, the Bernanke did not implement or hint that any new QE-2 is on the way. When you think about it, he really needs to save that bullet as inflation in India, China, Brazil, and the Middle East is already at dangerous levels. If the Bernanke crushed the U.S. Dollar Index by implementing another QE-3 these countries would be irate. Federal Reserve Chairman Bernanke did say that he will keep the fed funds rate at zero percent until late 2014. This news was basically already factored into the market.

Now all eyes will be on the European Central Bank President Mario Draghi tomorrow. Last week, Super Mario gave a speech in which he said the ECB would do whatever is necessary to keep the Euro alive. He also said, “believe me it will be enough.” This statement by Super Mario sent the major stock indexes in Europe and the United States soaring higher. Tomorrow morning, the investing community is waiting to hear details about this genius plan to save the European Union. 

Most traders and investors believe that the next plan by the ECB is to sell Euro-bonds. Germany is the one solvent country in the European Union and they seem to be very opposed to any issue of Euro-bonds. It is certainly not in Germany's best interest to have Euro-bonds issued as they will likely to be on the hook for the money needed to pay the interest on the debt. Some leading equities that will likely be volatile after tomorrow's ECB announcement include the CurrencyShares Euro Trust (NYSEARCA:FXE), Deutsche Bank AG (NYSE:DB), Banco Santander, S.A. (ADR) (NYSE:SAN), and the iShares MSCI Europe Fincls Sector Index Fund (NASDAQ:EUFN) to name a few. It is safe to say that tomorrow's announcement will be a market moving event. 

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Stronger than expected U.S. ADP numbers reassured investors that the central bank won't say anything particular damaging to the U.S. dollar.  In a few short hours, the Federal Reserve will deliver its monetary policy decision.  Central bank meetings are traditionally one of the most market moving event risks for the forex market and based on the recent consolidation in FX, currency traders are waiting anxiously for a big announcement. Unfortunately they will need to keep on waiting because the Federal Reserve is widely expected to leave the size and scope of its Quantitative Easing program unchanged.  There's even a good chance that the August FOMC statement will contain the same language as the June statement.

Kathy Lien