There was some weakness in the market today. The DOW was up before reversing and is currently down about 80. It is going to be quiet tomorrow and Wednesday leading up to the Federal Exchange news on Thursday. The next couple of days will have a wait and see attitude. There was a lot of underlying strength in gold. Gold got up to the 1109-1110 range, up 5 or 6 dollars at one point today. If the Federal Reserve leaves interest rates unchanged gold should go up, if the Federal Reserve raises interest rates gold should go down. I do believe the lows are in for the year. With gold up today I believe there is a 90% chance the Federal Reserve leaves rates at 0%. I have a sell signal on the daily and weekly charts for gold but that could change with the Federal Reserve’s announcement Thursday. Back when the unemployment was around 8 % the Federal Reserve said that if unemployment got to 6.5% they would start raising interest rates. They did not do that. The IMF (International Monetary Fund) stated that they asked the Federal Reserve not to raise interest rates. The unemployment rate is now at 5.1%. With all of these factors I don’t expect the Federal Reserve will raise interest rates. Oil got down around the 43 level today. At one point oil was down about 80 cents today before rallying and selling off towards the end of the day. I said I am looking for a higher low in the 39-43 level where I would be looking to buy oil and oil stocks such as SN (Sanchez Energy) and VNR (Vanguard Natural Resources). I expect the next move up to be to the 46-48 level. Long term I am bearish on oil.
Big Fed Decision Thursday
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