Fed Slogs On, Traders Flinch | The Gold Forecast

Fed Slogs On, Traders Flinch

October 31, 2013 - 4:42pm

 by Gary Wagner

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Gold Forecast: Proper Action

On 10.23.13 we sent out a special trade alert with buy signals. On 10.28.13 we recommended either raising  stops to 1330 or exiting the trade (take the money and run). Yesterday we also suggested exiting gold  trade. At this point all trader should have taken profits on gold trade.

 

 Long gold @ 1332.20 out @ 13 50 = + $ 17.80 (1780 per contract)

 Maintain Long silver @ 22.60 with stops below 21.84

Gold Market Forecast

Traders and analysts are so hungry for news that emerges from a FOMC meeting that in the absence of any real news, they will fixate on the absence as if that was news. Such was the case as market technicians and analysts attempted to make sense of the most recent statement issued following the conclusion of today's FOMC meeting. As such we saw fairly wild gyrations in the precious metals markets. Initially, prior to the conclusion of today's meeting of the Federal Reserve, gold prices edged higher, trading to an intraday high of 1360. Following the conclusion of today's meeting we saw gold prices dramatically dive first to negative territory and then finally settling in essence unchanged on the day.

 

Such volatility has become part and parcel any time the investment community awaits information from the Fed. What is perplexing about today's activity is that pundits seem to be focusing on what was not said, as no real statement of a change in either commitment or the dynamics of our current monetary policy was issued. On a technical basis we must focus on gold prices becoming stifled at the current resistance level of 1360. We have identified this area as a critical resistance area, but more importantly an area that must be taken out if the recent rally and higher pricing in gold has any chance of continuing. The fact that gold could not take out this price point signals the potential for lower prices in gold in the near future. Today's show will detail in outline that basic assumption. 

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