Advertise | Bookmark | Contact Us | E-Mail List |  | Update Page | UraniumSeek.com 

Commentary : Gold Review : Markets : News Wire : Quotes : Silver : Stocks - Main Page 

 GoldSeek.com >> News >> Story  Disclaimer 
 
Latest Headlines

GoldSeek.com Radio: John Williams and Louis Navellier, and your host Chris Waltzek
By: radio.GoldSeek.com

Technical Scoop - Weekend Update Nov 19
By: David Chapman

Zero Hedge invites Financial Times to heed GATA's urging on gold suppression
By: Chris Powell

The Great Retirement Con
By: Adam Taggart

Perspective on the Gold/Oil Ratio, Macro Fundamentals and a Gold Sector Bottom
By: Gary Tanashian

Global Silver Investment Demand Maybe Down, But Still Double Pre-2008 Market Crash Level
By: Steve St. Angelo

Secular Bull Stock Market?
By: Gary Savage

Gold Seeker Weekly Wrap-Up: Gold and Silver Gain Over 1% and 2% on the Week
By: Chris Mullen, Gold Seeker Report

Ira Epstein's Metals Video 11 17 2017
By: Ira Epstein

Next-Generation Crazy: The Fed Plans For The Coming Recession
By: John Rubino

 
Search

GoldSeek Web

 
Gold the $ and the FED


 -- Published: Thursday, 11 December 2014 | Print  | Disqus 

The incessant commentary about the FED hiking rates is supported only by government data. Retail sales appear great as does the employment situation. Everyone is entitled to their opinion and mine is that the data is fabricated.

The rationale is simple. The FED is out of bullets. They cannot be zero bound when the next downturn comes. They cannot be zero bound when the equity market goes into a bear market.  There is however a very big problem with the rate hike camp. The yield curve is collapsing and the FED has never raised rates in any environment other than a rising yield curve. The other elephant in the room is obviously the dollar and the effect it has on “inflation mandates.” With the Western World desperately trying to create inflation by crushing their respective currencies, the FED is supposedly going in the other direction.

The gold market is tracking the Yen/$, although the correlation is definitely weakening, as absolute levels suggest gold should be much lower. So, where does this leave us heading into the FED meeting?

Going back six months we see a bullish broadening wedge. Refer to Bulkowski for the odds of a breakout and the measured move.

 

In a shorter time frame the view is a little less sanguine.

Gold is most likely going to fall out of this short term rising wedge. The FED meeting and the Japanese election will have great influence on what it does from there.

In the longer term the only thing that matters is gold de-coupling from the dollar trade. The spark that will make this happen is without a doubt one of two things. Either there is a military confrontation of extreme significance or we start to see massive stress in global sovereign debt.

Once either or both of these occur, the pair trades that everyone seems to have on, along with hedges that have worked for years will all go up in smoke. That period of time is coming and when it does I believe volatility in gold will reach unprecedented levels. Until that time, gold will continue to trade irrespective of supply and demand fundamentals and simply mirror FX.

It’s a Mystery


| Digg This Article
 -- Published: Thursday, 11 December 2014 | E-Mail  | Print  | Source: GoldSeek.com

comments powered by Disqus



 



Increase Text SizeDecrease Text SizeE-mail Link of Current PagePrinter Friendly PageReturn to GoldSeek.com

 news.goldseek.com >> Story

E-mail Page  | Print  | Disclaimer 


© 1995 - 2017



GoldSeek.com Supports Kiva.org

© GoldSeek.com, Gold Seek LLC

The content on this site is protected by U.S. and international copyright laws and is the property of GoldSeek.com and/or the providers of the content under license. By "content" we mean any information, mode of expression, or other materials and services found on GoldSeek.com. This includes editorials, news, our writings, graphics, and any and all other features found on the site. Please contact us for any further information.

Live GoldSeek Visitor Map | Disclaimer

The views contained here may not represent the views of GoldSeek.com, its affiliates or advertisers. GoldSeek.com makes no representation, warranty or guarantee as to the accuracy or completeness of the information (including news, editorials, prices, statistics, analyses and the like) provided through its service. Any copying, reproduction and/or redistribution of any of the documents, data, content or materials contained on or within this website, without the express written consent of GoldSeek.com, is strictly prohibited. In no event shall GoldSeek.com or its affiliates be liable to any person for any decision made or action taken in reliance upon the information provided herein.