Read my lips, “no more interest rate hikes for the next couple of years.” | The Gold Forecast

Read my lips, “no more interest rate hikes for the next couple of years.”

March 19, 2021 - 8:10pm

 by Gary Wagner

According to Wikipedia, “Read my lips: no new taxes” is a phrase spoken by then-American presidential candidate George H. W. Bush at the 1988 Republican National Convention as he accepted the nomination on August 18. However, the sad truth is he made a pledge that he was not able to keep. In fact, the New York Post published a similar headline the following day that said, “Read my lips; I lied.”

This phrase, spoken by George H. W. Bush, is a perfect example of a politician’s broken promise and will forever remain a landmark example of broken promises made by politicians.

However, in the case of Chairman Jerome Powell, his statement about not raising interest rates in 2021, 2022, and maybe even into 2023 seems to be a pledge that he will steadfastly honor given the nature of the recession created by the pandemic.

What is interesting is that in contrast to Bush’s statement, which was actually accepted as a believable pledge and quickly broken, the probability that we will not see an interest rate hike this year is almost an absolute certainty. As for 2022, there were only four dissenting members at the most recent FOMC meeting, signaling that the majority of Federal Reserve members are in agreement as to their future monetary policy in regards to Fed funds rates.

In the case of the Federal Reserve’s pledge, it seems that market sentiment does not agree or see this as a feasible possibility. The fact that 10-year treasury notes have been moving up substantially over the last week is an example of market participants voting with their investment capital.

Immediately following the conclusion of the FOMC meeting on Wednesday, we saw gold stage a strong rally moving from roughly unchanged to close higher by double digits. More importantly, the rally that continued to take gold higher on Wednesday has continued to be a guiding force taking gold pricing higher. Many analysts interpreted the gains as a direct result of the Federal Reserve statement, which included the most current “dot plot,” indicating that interest rates most likely will stay where they are through 2023.

This time Chairman Powell made it clear that it is the Federal Reserve’s intent to keep interest rates where they are for a long time. The statement is being made as new data suggests that the economy is rebounding, which even Chairman Powell agrees with. The fact that he is forecasting a GDP of 6.5% by the end of the year is more than extremely optimistic, and some even believe it is just wishful thinking.

Today gold continued its upward climb gaining $11.40, with the most active April 2021 Comex contract currently bid at $1743.90, which is a net increase of.66%. Just as impressive is the fact that the rally in gold has occurred concurrently with dollar strength and treasury yields staying above 1.5%. In other words, against the headwinds provided by a strong U.S. dollar and stronger yields, as shown the determination of gold bulls to take the precious yellow metal higher. These recent gains are even occurring in the light of bitcoin once again challenging its all-time record high. Bitcoin futures today closed up 1.88%, or $1080 per coin taking bitcoin futures to $58,445 per coin.

Whether your current market sentiment is bullish or bearish in regards to gold pricing, one must acknowledge the absolute strength and determination to move higher against market forces that would typically result in a price decline.

In the words of Chairman Powell, it will be the pandemic that dictates action by the Federal Reserve, and they will not act in a way that could hinder a full recovery in the fastest period of time. It might just be that the currentt monetary policy of the Federal Reserve is not just words alone, but it has been followed with action and a steadfast commitment doing what they said they would.

Wishing you, as always, good trading and good health,

Gary S. Wagner - Executive Producer

This report is now free and publicly available to everyone

Gold Forecast: Proper Action

On March 10th we issued trade alert to buy gold and silver.

On March 16 we raised stops to

Futures: GC 1690. SI 25.3 ----- Forex: . XAUUSD 1690. XAGUSD 25.3 -------- ETF's: GLD 159.35. SLV 23.5

Futures contracts:
Buy April 2021 gold (GC J21) @ the market current $1722.80. Place stop at $1690
Buy May 2021 (SI K21) @ the market current $26.26. Place stop at $25.30

Electronically Traded Funds:
Buy GLD at the market current $161.55. Place stop at $159.35
Buy SLV at the market current $24.24. Place stop at $23.50

Forex / spot markets:
Buy Forex gold @ the market current $1724.40. Place stop at $1690
Buy Forex silver @ the market current $26.17. Place stop at $25.30

On February 18 we entered a long April Platinum trade. In at $1282. Our stop was hit today (02/26/21) @ at $1217.00
SILVER FUTURES MARCH: Entry at $27.36, and then closed the trade later @ $27.45.
XAGUSD: Entry at $27.26,, our stop was hit at $27.39

We closed our positions in SLV:
First leg SLV: @ 22.95 .out at @ $24.99
Second leg SLV @ 24.60. out at @ $24.99

On Thursday February 4 stops were hit on our long GLD ETF. We entered at 172.14. Our stop was hit at $168.29 (the open on Thursday) for a $3.85 loss per share.

GOLD FUTURES APRIL: Entry at 1845 - 1859 . Stop hit at 1813 - average loss $3900 per contract
XAUSUD: Entry at 1845 - 1857 . Stop hit at 1813 - average loss of $38 per oz
SILVER FUTURES MARCH: Entry at 25.42 - 25.46 . Stop hit at 24.11 - average loss $6650 per contract
XAGUSD: Entry at 25.33 - 25.40 - Stop hit at 24.11 - average loss $1.3 per oz
long February gold @ $1890.00 and stop hit @ $1902.20, for a profit of $1202.00 per contract
long Forex gold @ $1886.00 and stop hit @ $1898 for a profit of $12.00 per OZ
long March silver @ $26.31 and stop hit @ $26.41 for a profit of $500.00 per contract
long GLD @ $177.26 and stop hit @ $178.00 for a profit of $0.71 per share
long SLV @ $24.67 and stop hit @ 25.00 for a profit of $0.33 per share
long February Gold Futures at $1860-$1866 and stop hit at at $1869. Average profit $600 per contract
long XAUUSD at $1856-$1862 and stop hit at $1866. Average profit $6
long March Silver Futures at $25.16 - $25.25 and stop hit at $25.30. Average profit $450 per contract
long GLD @ $174.12 and stop hit at $175.78 for a profit of $1.66 per share
long GLD @ $174.12 and stop hit at $175.78 for a profit of $1.66 per share
long February Gold Futures at $1830 -$1843 and out at $1850 for a profit of $700 to $2000.00 per contract
long XAUUSD at $1841 and out at $1850 for a profit of $90.00 per mini 10 oz contract
long March Silver Futures at $24.29 and out @ $24.40 for a profit of $550.00 per comex contract
long GLD @ 1$71.50 and out @ $173.00 for a profit of $1.50 per share
long SLV @ $22.30 and out @ $22.50 for a profit of $0.20 per share
Long December gold at $1899. Stop hit at $1918, for a $1900 profit
Long forex gold at $1896.00. Stop hit at $1912, for a $1600 profit
Long December silver at $24.21. Stop hit at $25.07 for a $4300 profit
Long GLD at $180.46 and stop hit at $176.42 for a loss of $4.04 per share
Long SLV at $23.23 and stop at $22.78 for a loss of $0.40 per share
Long December Gold Futures at $1926 and stop hit at $1907.30 for a loss of $18.70 per ounce
Long Forex Gold at $1922 and stop hit at $1903 for a loss of $19.00 per ounce
Long December Silver Futures at $25.13 and stop hit at $24.73 for a loss of $0.40 per ounce
Long December gold at $1890, out at $1909.30 for a profit of $1,930.00
Long December silver at $23.95, out at $24.50 for a profit of $2,750.00
Long Forex gold at $1883.68, out $1907 for a profit of $23.32 per ounce
Long GLD ETF at $178.03, out at $179.80 for a profit of $1.77 per share
Long SLV ETF at $22.66, out at $22.03 for a loss of $0.63 per share

Gold Market Forecast

This is been an exceptional couple of weeks for subscribers at the gold forecast as we were able to correctly identify a key reversal pivot and most importantly act upon it by initiating a trade. Throughout the last couple of weeks, I have explained components behind my thought process starting from why we got in at the price we did.

Why we place our initial stop where we did. And most importantly how we came to create models to formulate our exit strategy or target. I felt it was necessary to take all of these factors that I have put in a separate chose into one viable 12-minute video that will explain in detail all of the aspects of our current trade.

While many of you understand the basics of Elliott way about, I have also included a short video by Investopedia, so that those who are unfamiliar with the basic premise and foundation of this theory can get up to speed and understand what we are discussing in a more educated manner.

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