This post was just published on ZYX Buy Change Alert
Our read of the FOMC statement is that QE3 is on track. Many FOMC members favor easing soon as they seem to be focused on high unemployment.
As a result of the statement, stocks are spiking up, bonds became stronger and dollar slumped.
Most notable is the initial spike in gold to $1646.75. This is notable because gold broke through heavy resistance at $1640 – $1642. The next big resistance is $1672 – $1675.
Caution: FOMC minutes are released to the public after considerable delay. The economic data that we have been writing about in our morning capsules since the last Fed meeting has been strong. The Fed meeting occurred before the strong economic data.
Now expect a tussle in all markets between those who understand that FOMC minutes are delayed and the momo crowd that is buying on the news without any deep understanding.
We will be writing more especially if there are any trading opportunities in gold and silver later this afternoon.
Until the results of the tussle start becoming clear there is no change in our rating for gold given in prior posts. For any reversal in gold to be meaningful, gold will have to break $1638 on the downside. On the upside, the immediate very short-term micro resistance is at $1652 in gold.