Gold Presages Fed Inaction
Gold is following through on Tuesday’s late rally,
providing an early indication that the Fed will not raise interest rates at its
FOMC meeting Wednesday. Gold is still viewed by some as a hedge against
inflation. Despite a slow-down in the economy, inflation could be creeping into
the economy due to higher energy costs and a still-vibrant US economy.
Gold has also risen in recent weeks as the US dollar has
declined. Most gold purchases are dollar-denominated and a cheaper dollar makes
the metal relatively cheaper, spurring demand.
Orange juice is making good on a Turtle Soup Plus One
Sell signal. Juice was unable to close above the June 20 high and after an
early head fake, the September contract rallied to take out Tuesday’s high, leading to a steep decline of more than three cents. A Brazilian agricultural agency is expected to issue to issue a report this week showing the orange crop is strong.
From the Implosion-5 List,
cotton is trading lower for a sixth day and at its lowest level since late
April.