Video-June-14-2013-Archives-Daily-Show
Video section is only available for
PREMIUM MEMBERS
|
Waiting For The Fed
Since Ben Bernanke mentioned that there is a (small) possibility that QE3 will be tapered and eventually ended, the equities markets have lost over $3 trillion. A trillion here, a trillion there... pretty soon we're talking about real money.
The question has become, over the last 5 weeks: why the heck did Chairman Ben say such a thing when the targets that he and other Fed doves have been flogging for more than a year are nowhere in sight.
Clearly, as we know from watching gold spin and dip and soar and retreat like a bumblebee on narcotics, it has affected the precious markets.
So, we want to know, "was it a trial balloon?" That's a very expensive balloon. Bernanke can't possibly be that ignorant or callous.
Or, "was it merely a bone for the red-meat hawks?" Also quite silly. The hawks - those against continuing stimulus and low interest rates - don't have the votes on the board that runs this year's Federal Open Market Committee (FOMC).
Or, "was it done as a preemptive strike against an asset bubble?" If there was an asset bubble in equities, it certainly has been popped by the $3 trillion loss cited above. And, if Bernanke's comments were preemptive, what would the real war look like? So, it sounds equally absurd.
Finally, among the possible answers is, "was the Bernanke chatter a tap on the brakes?" We know what the answer is to that as well.
We have our own analysis. It was a mistake that was then amplified first by nervous, volatility-addled investors and traders and then by the financial and popular press. It was irresponsible right down the line.
We are not alone in suggesting that QE3 is not close to ending. More high-profile media outlets are beginning to carry the banner we have been waving.
Jon Hilsenrath, a reporter for The Wall Street Journal whose writings are closely scrutinized by investors, weighed in on Thursday saying the Fed is not close to ending its stimulus. "An adjustment in the program won't mean that it will end all at once, officials say, and even more importantly it won't mean that the Fed is anywhere near raising short-term interest rates," Mr. Hilsenrath reported. "Investors aren't listening."
Ahhh... no longer a voice crying in the wilderness.
As always, wishing you good trading,
Gary S. WagnerExecutive ProducerMarket Forecast:If you look at a weekly chart of gold you will see in interesting pattern emerging over the last three weeks, or maybe better said a lack of a pattern. The last three weekly candles on our gold chart are “doji” candles. This type of candle is created when the open and close are either identical or very close in price point. Such is the case currently in gold as we await next week’s FOMC meeting which begins on Tuesday. This type of candle conveys absolute consolidation in the market. It also can point out pivot points for price points in which you might witness a key reversal in the direction or trend. To see it does you for three consecutive weeks is significant, especially when found near a key support level. Over the last few weeks we have been identifying 1335 as that significant level. It is precisely a 50% retracement from the Super Bowl run which began in 2008 and concluded above 1900 an ounce in 2012. Whether this level holds or not will determine the absolute bottom found within gold prices. If we see a move or break below that, gold could easily trade down to 1200 or even 1100 per ounce. I believe that it is more likely that we will see this level hold and conclude this long correction. However with a Fed meeting next week absolutely anything is possible. Video archives:http://thegoldforecast.com/video/april-2013-archives-daily-shows http://thegoldforecast.com/video/may-2013-archives-daily-shows
Market Sentiment: Bearish, Range bound sideways market.
Support at 1360 resistance at 1380, 1403 then 1424
From the week of 06.07. 2013 COT LINK See previous weeks in Historical Commitments of Traders Reports. |
|
|
Gary S. Wagner - Executive Producer