All Eyes/Hopes on the FED

The insanity goes on my friends! The first 2 days of the week and the Dow Jones is off to the races, rising almost 300 points in the past 2 sessions to start the week, all on hopes that the Fed will save the day. Tomorrow should be an interesting day and what we have seen the past 2 days, in my opinion, is absolute foolishness or simply the game being played by the INVISIBLE HAND with light volume in the summer time markets. I say with confidence that the highs are in this year for the US equity markets and I welcome the recent volatility with open arms as it offers us as traders larger opportunities. My advice, do not hold on to a trade for all that long, pick your entries and most importantly your exits as the volatility can offer up many BIG trades.

Take a look at the Dow chart, it looks like it is poised for more gains. I feel that this is due to hope that the FED can pull something magic out of its hat tomorrow. I think the markets are in for a rude awakening tomorrow afternoon, just my gut feeling.

At the same time, the US dollar looks like it may be due for a bounce from here. Please take a look at the chart.

Here is Oil, looking ready to plow through $100, I really do not want to see that.

Last, I will speak on GOLD, first let's look at the chart

Technically, you could not have an uglier chart if you are bullish. If there is a hint of tapering QE, short term, Gold could get taken lower, if it breaks $1320- most likely we will see it trade into the 1200's. With that being said, if the FED does hint at tapering or the markets are led to believe that the FED will do so in the coming months, I feel all hell will break loose with the global BOND and global Stock Markets and that eventually GOLD will gain its long over due safe haven status throughout the world and we will be finished with all this suppression nonsense!

Bottom line- tomorrow should be an interesting day to say the least. At this point I think the FED is caught between a rock and a hard place. My opinion is that any talk of TAPERING is just talk, you must be careful because the markets are all about perception! It may just be a smart thing to watch tomorrow afternoon and watch the reaction of the markets from the FED meeting and then work with what the markets give you in the coming days. No matter the outcome of tomorrow's meeting, BIGGER picture, the US Dollar, Stocks, Bonds are in for troubling times ahead and GOLD will have its next major move to the upside that will most likely surprise everyone!

 Good Night and BE Safe

 Martin