Today is the day the Fed “most probably” will raise interest rates. Gone, for a while at least, are ultra-cheap mortgages and car loans. Anticipating this rate, banks and lending agencies around the country have been raising their rates for over a month now. Gold has dropped enough to qualify as an actual correction.
So the pump is primed. Will they do it? Find out at 2PM Eastern time today!
In the meantime, traders are in waiting mode. Very little action this morning. Expect a HUGE flurry of activity starting about 1:45, because apparently no one can keep a secret.
The Gold Enthusiast believes Janet & company will indeed raise rates. The question is will the raise be the expected 0.25% (a quarter-point) or will they be aggressive and go for 0.50%?
In any case you can expect at least a slight drop in gold. The only question is whether gold will go down just a bit, or significantly. We’ll be watching to see if gold only confirms its recent lows with a move down 110 or possibly 109 in GLD, or if it will drop down below 109 which would indicate a probable move to 105 and possibly 100. The low we see over the next few days will probably be our new trading floor. Trying to guess what it will be is a fool’s game, as we can wait and see with no risk.
As the old story goes, Once more into the fray!
Signed, The Gold Enthusiast