Actually it was reported 400 bln and below would mean bullish. But anything higher would mean banks are leaning more on ECB for support with expectations of Greece going default
The impact of LTRO is a very complex issue, we are talking about some serious maths here. Plenty of aspects involved, EUR fair value, ECB balance sheet, impact on economy expectations etc. etc. All that will brew the outcoming market sentiment which will in the end result in move up or down (which one itīs going to be I dare not say...).
Frankly, lower amount = short term bull (belief in positive effect on economy will overweight fear from EUR being diluted), long term bear, higher amount = short term bear (exactly the opposite), long term bull (the effect in the long run will probably be higher)
But what the hell do I know in the first place
Btw - one last piece of advice from me today - if itīs high, buy gold. Pure maths says that anything close to 1 trl will move fair price of gold somewhere slightly under 2.000...Disclaimer: This is not a trading advice - if you screw up, donīt come to cry on my garden, itīs your money and your risk
Quant Hedge Fund CEO
