Fed Wants Out, Deal With It The Fed held true and added to its conviction to end bond purchases by tapering an additional $10 billion in February. The equity market, which was well ahead of itself at year-end on the euphoric drug of stimulus, continues to re-trench, searching for a fundamental value base. The metals continue to trade at different metric levels, with the industrial complex influences by the suggestion that emerging markets will contract and reduce industrial demand, while gold continues, albeit “weakly” to attract safe haven capital. We have exited the platinum short/long gold trade at the $140 premium target from an entry some $60 higher, but until there is a clearer sign that the “emerging market issues” stabilize, the spread could continue to narrow in to the $120 range. But, a bird in hand. An aggressive trade, “if” you see the stabilization of the emerging markets and the see the drop in U.S. equities as a mere correction, would be a long silver/short gold spread - currently at 65:1, with an exit at 60:1. By Peter Hug Global Trading Director Kitco Metals Inc.
Posted on: Thu, 30 Jan 2014 14:29:58 +0000
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