Mid-Day Gold & Silver Market Report – 9/12/2013
STIMULUS TAPER SPURS TECHNICAL SELLING OF GOLD
The Gold price has fallen again today as another round of uplifting economic data has most analysts convinced the Federal Reserve likely will announce an initial reduction in the level of monetary easing. “Today’s data is another nail on the coffin, and people expect the announcement on tapering to come next week,” Frank McGhee, the head dealer at Integrated Brokerage Services LLC, said. Gold futures fell more than 2 percent as tapering expectations gave way to an onslaught of selling once the price broke below key technical levels. Sharps Pixley CEO Ross Norman said, “With things quieter on the Syria front and really not much to add on taper, the market is behaving quite technically just now and traders very much studying the charts.” Investors and analysts will continue to look to next week’s Fed policy meeting to see if Gold can hold above new support levels should an announcement of asset purchase tapering be declared.
U.S. stocks are also feeling pressure from the upcoming Fed policy meeting as today’s jobless claims data gave further impetus for analysts to forecast a reduction in stimulus measures. The S&P 500 was on a seven-day rally until today and historically, strong economic data has spurred upward momentum for stock markets. However, much investor sentiment has become reliant upon the Fed to help buoy equities and any domestic economic improvements serve as incentive for Fed officials to let markets rely upon traditional economic factors for sustenance.
At 1:13 p.m. (ET), the APMEX Precious Metals spot prices were:
- Gold, $1,331.60, Down $34.20.
- Silver, $22.21, Down $0.99.
- Platinum, $1,441.00, Down $33.50.
- Palladium, $690.80, Down $0.60.
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