FOMC Forecast: Tapering QE Announcement Effect On Gold & Silver Prices

Whether or not the FOMC meeting results in gold prices either skyrocketing or crashing depends on one thing: will they taper. It is safe to say the market believes that Ben Bernanke will taper the massive quantitative easing and announce his plan to do so during the upcoming FOMC meeting. The sentiment going into this announcement seems to be largely indecisive, no one really knows what the effect will be on the market. However if they do taper, by any amount, it is quite possible that we might be resuming in this downtrend for the rest of the year. The short term relief rally that we've been experiencing this year has gotten way ahead of itself due to the threat of war with Syria. Now that this event has been temporarily resolved, it gives even more weight to the bearish side of gold.

[youtube]http://www.youtube.com/watch?v=iBkN3Nb7NdA[/youtube]

Read more: http://dailysilverupdate.com/blog/2...qe-announcement-effect-on-gold-silver-prices/

 

Who is going to buy all those US Treasuries (new and redeemed) if uncle Ben 'tapers'?



OC

 

What makes you think they won't keep printing as required to maintain liquidity when they say they've stopped, slowed down or (fancy term) 'tapered'? All central banks have been printing Monopoly Money 'to infinity' since 2009 as far as I'm aware...

 

I know!

Ben could print the notes and toss them out of a helicopter!


OC

 

Should still disguise it as a phoney ticker-tape parade

 

I have this feeling in the back of my head that there is an off chance that there might be a quick drop and then a Very quick and large rise in gold prices after all this takes place.

If the fed announces a taper In late sept (I think it may be a minimal taper) But to start in late oct, then i think gold will drop around $200 to be around $1100 USD. But it will rise quickly again as the physical buying will explode again as it did earlier this year.

This all leads up to the vote on raising the debt limit in the US congress in mid-oct an the last time it happened it was an 11th hour vote that raised it, that may not happen again this time. If it doesn't get raised then it is a gov shutdown. If there is a gov shutdown, then gold could explode (IMO)

The US would most likely get downgraded again and the fed would reverse their taper policy before it has begun as Yellen takes over from Ben. There would still be a massive amount of gold shorts in place left over from the fed taper announcement, and they would get wiped out as gold went higher and push prices even higher. Moreover, the earlier rush to physical would create a momentary drain in the physical market. Add in the fact that JP Morgan have stopped redeeming paper gold for physical gold. It is a potential super storm wipe out scenario that blasts gold well into the $2000 USD range.

This could be my mad ravings, but who knows. I hope it works out this way and gold goes way up!

 

Here's my take on it... NO TAPER, Small spike up just before announcement to take in a few longs, big spike down to clear as many long stops as possible then rocket back up to where we started maybe a tad more.

Then taper talk 4eva taper walk Neva