Pre-Fedline Open Thread
With just fours hours to go until "the most important FOMC headlines in years", here's a thread to enter your predictions and discuss the consequences.
Of course, ole Turd is on the record stating that a BLT (Bernank Legacy Taper) is about a 50/50 probability. What I'm 100% certain of is a rally once it's all said and done. Why? There are just two scenarios:
- A BLT. Something like $10B/month, dropping ongoing QE∞ all the way back to just $75B/month or $900B/year. The pre-programmed algos will SELL at 1:59:55 and gold will puke back down to $1210-1215 before immediately reversing and squeezing the shorts.
- No taper. Price immediately soars through $1250 and on toward $1260. Rallying further this evening and into tomorrow.
Hmmm. Looks like, either way, prices head higher from here, not lower. Again, when everyone is on the same side of the trade, everyone is bound to be wrong. In this instance, everyone is short, expecting a taper and expecting gold to drop through $1180. You should expect the opposite.