7/30/12 2:29 PM – Processing . . . Processing . . .

The computer screens of institutional traders are apparently showing the ubiquitous hourglass that means the program is still processing and unable to accept another command.

There is not much news today but there is potential for plenty to sway traders later this week.

The Federal Reserve is being closely watched for an announcement of another round of quantitative easing, or at least hints of it. The Fed will make an announcment Wednesday when it concludes its meeting and communicates at least whether the discount rate will be changed. A sign of any kind of monetary stimulus would be a big hit with the markets, at least risk-on assets like stocks and gold and other commodites. It would be a negative for the US dollar.

Thursday, the European Central Bank (ECB) makes a similar announcement. Since ECB head Mario Draghi announced last week that the ECB would not let the Euro fail and that whatever it did would be enough, the markets have moved up in anticipation of something very significant. There may not be such an announcement at this meeting and if not, that would be a negative for world markets. Announcement of a new program will be judged on whether it is 1) significant and 3) needs other approvals and 3) whether it is seen as providing relief to the struggling economies of Spain, Greece, Portugal and Italy.

Friday, the jobs report comes out again.

Also on the table is whether or not the market is flattening out or will continue its recent upward seesaw trend, now near a high point, according to the pattern of the last two months. The rallies and selloffs since May 31 have been remarkably symmetrical, both in their percentage movement and duration. A quick look at an S&P 500 chart set on three months will show you immediately what I mean.

Bottom line: this week is unlikely to be dull once we get to the second half of the week, i.e. Wednesday PM.