Monday market action has opened on a cautious note. There was not much in the way of economic news this weekend. And all eyes collectively are on the Federal Reserve which will announce monetary policy and issue its economic statement this coming Thursday. It has been data from China and Japan which has been quite interesting. Exports from China have shown another decrease while inflation and weaker domestic demand are showing cause for concern. Industrial Production results missed their forecast coming in at 8.9%, while a figure of 9.0% had been expected. It should be noted that China is getting ready for a scheduled change in some of its party leadership and that government ministers have been making their way to various microphones to pledge their support for a better economy.

In Japan earlier today GDP numbers did not match expectations. A gain of 0.2% compared to the estimate of 0.3% was the outcome. While this is not a huge difference it continues to show that Japan while still one of the most prosperous nations in the world has lackluster growth and its prospects for achieving better results remain challenging. The problem collectively between China, Japan, and Korea is that if the countries continue to show signs of regression that this is yet another symptom of a global economy that is struggling more.

The JPY has continued to gain on the USD the past couple of weeks like many of the major currencies. The strength of the JPY does very few favors for its exporters however. The JPY/USD is nearly in the middle of its well established range which has often been described as a ‘dance of consolidation’.

The EUR/USD has remained near its upper values as of this afternoon in Europe and Gold has come off of its highs but remains near 1732.00 USD as of this writing. Crude Oil is near the upper boundaries of its range also. Equity markets in Asia and Europe have been tranquil and appear to be in a holding pattern until American investors get underway in the next couple of hours. U.S. Trade Balance statistics will be released tomorrow. Range trading may be the rule of thumb for the Single Currency and Greenback the next couple of days.

Thus the most relevant news items continue to be what will take place via the German Constitutional Court ruling sometime the middle of this week – a decision could come on Wednesday. And the FOMC from the States on Thursday.

While most investors are counting on an approval from the German courts and some type of stimulus package from the Fed, it can be counted on that the wording of both key decisions will have an impact.

What traders have to ask themselves is how much of the ‘good’ news has already been built into the broad markets and what the reaction will be if anything in the way of a surprise comes down the avenue.