Market Waiting on Fed-not Greece-to Boost the Euro

      With some good news in Greece-for the markets not necessarily the Greek people-the markets nonetheless are sagging.  The reason is this still not a lasting, comprehensive solution.

      The markets are still worried over Spain. And the political will in Greece even with the victory of the pro austerity parties is weaker than ever.  The market is actually rising a little now with the Nasdaq back in the green based on the best US housing starts in 4 years.

     The market is now looking to the Fed to provide a lift to the markets tomorrow:

      “(One) reason we expect the euro to push higher has nothing to do with Greece. We think the Fed is going to open the door to further stimulus (on Wednesday),” Ashraf Laidi, Global Chief Strategist at City Index told CNBC Asia’s "Squawk Box" on Monday. Laidi forecasts the euro-dollar will move as high as 1.2850 this week."

      "Citing recent weakness in U.S. economic data, Laidi predicts the country’s central bank will extend Operation Twist at the June 19-20 meeting. "

        http://www.cnbc.com/id/47853777

       Of course there is a lot of skepticism about Operation Twist. It hardly seems that high long term rates are the problem. Still it is believed it will be good for expectations"

       “Even though Operation Twist is not going to prove (to be) net effectively positive, the fact that the Fed is going to open the door for that, is going to be a positive for risk appetite,” he added.

       "While Laidi believes the outcome of the Greece elections will provide support for the currency, he says concerns over the solvency of the debt-ridden nation will limit any major upside."

        So it it's all about expectations and even a program with limited expectations will be effective via that channel does the Fed know this? Does it realize that not doing anything tomorrow-or saying something dovish-could further weigh down the market?