Friday November 01, 2013 07:40
Although we suggested that the market looked heavy yesterday, it certainly wasn’t premised on my read of the Fed statement. Smarter minds than mine read the economy is showing signs of strength, which was interpreted as a hawkish sentiment indicating a possible taper by December. Not what I heard and judging by recent economic data, especially the dismal consumer confidence readings, I am amazed that tapering talk is on the table, especially for this year. If truly, this was the reason for yesterday’s sell-off, I think data between now and December 1st will dismay the “hawks”. In my opinion the market would have been hammered on Wednesday had this been the true cause. I suspect the inertia of the markets after the Fed stayed the course was the straw that broke the hands of the weak bulls. Gold had little trouble in breaking the $1,325 support level and is set to test the $1,312 range, where it should find enough stability to get us through the weekend.