The FED reports, Gold weakens, Silver under pressure – By Todd Horwitz, Bubba Trading

 

The FED reports, Gold weakens, Silver under pressure

Wednesday the Federal Reserve did their usual nothing and continued to promise free money for longer. The attitude of throwing money at problems seems to be a weak solution. This time is no different Fed will at the end of the day be the problem, with every action they take a lockup market liquidity.

The Fed anticipation has created a huge rally in the metals taking gold to an all-time high, silver to nine-year highs. This morning action looks weak, the metals rally could be slowing and moving into a consolidation period. The recent rallies have been so parabolic the selling should be expected.

Since peaking on Tuesday gold, silver, and platinum have started to show some weakness. In typical fashion the rumor of what the Fed is going to do was bought, after the fact the selling is begun. For now, we look at selloffs as a potential buying opportunity, but there is some concern that the size of the rally that could take people back will further than we would like.

Those four magic words are running through Wall Street to the metals, combine taking away liquidity and you have wild swings in markets. “This time is different” the phrase that is destroyed more lives than anything else in the financial industry.

It’s never different, it will always be the same

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