Money "printing" involves a central bank buying "assets", usually sovereign debt, and crediting the seller with money that it has created electronically. The theory being that this money is used to encourage spending by way of loans to consumers and corporates, but which has the potential outcome of higher inflation. It should also drive short term rates down if, like with the OMT [Outright Monetary Transactions] operation, the ECB is buying at the short end of the curve - the complete reverse of the Fed's Operation Twist by the way. The announcement of OMT has had the desired effect on rates, especially Spanish and Italian, where the cost of new issuance was creating the debt servicing issue mentioned earlier. However with more than a nod to the Bundesbank, the ECB has declared that it will sterilise the purchases so that there will be no inflationary effect. They can do this either by selling other assets, for example long dated issues or attract deposits at the ECB both of which remove the newly created money from circulation. The first option is unlikely as they really don't want to drive longer term rates upwards, so they are left with the second or they could instead sell some of their gold reserves, but that would be akin to selling the family "silver". They wouldn't do that would they? Well they might! Thinking that politicians and central bankers would be so crass is another example of one of life's "heroic" assumptions. The Chinese would have it off them in a trice and how would that help the cause?

David Fuller's view Is sentiment regarding the Eurozone crisis a useful contrary indicator?

In the trading environment of the last three years, one could have done far worse than buy equities when talk of a euro "break-up" or "collapse" was rife, and sell them a few weeks after "euro" and "crisis" were no longer mentioned in the same breath.

Unfortunately, no correlation works all the time and most fail when they are most widely recognised. That is why we look at everything, not least the price charts.

The S&P 500 Index has paused today following last week's impressive extension of the ranging upward trend. A close beneath 1390 would now be required to break the progression of higher reaction lows and suggest a failed break above the March to May 2012 highs.