Sunday, 02 November 2014 19:19

Fed Moves Markets (Again)

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Wednesday October 29th saw the completion of the regularly scheduled two day meeting of the Federal Open Market Committe (FOMC). The statement issued  by the Committee Wednsday afternoon was widley considered more hawkish than expected on U.S. monetary policy. Although the Fed ended it's monthly program of buying bonds, closing the latest round of quantitive easing, the FOMC also noted improvement in the economy, widely interpreted as suggesting that interest rates will begin rising sooner than many have thought. This led to an immediate and significant rise in the value of the U.S. Dollar vs major currencies. Since many commodities including precious metals are traded in Dollars, this led to a sharp decline in the metals. By Friday October 31st, gold dropped to a multi year low of $1160 before recovering slightly to close at $1172. This is below the strong support level of $1180, and suggests gold may have a ways to go on the downside before reaching a true bottom. The next days and weeks will provide a clearer indication of the yellow metal's direction.

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Mitchell Battino

A professional numismatist with over thirty years of experience, Mitchell A. Battino is a certified appraiser and numismatic consultant who specializes in buying, selling, and appraising U.S. and world gold and silver coins. Mr. Battino is a regular contributor to numismatic publications, attends major coins shows, and travels extensivley to purchase deals and collections.

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