History repeats itself. When the Fed began withdrawing monetary stimulus in 2013, the price of gold plummeted. At that time, it took ten months to reduce QE. Currently, unemployment is at 5.2%, significantly lower than eight years ago, and inflation is much hotter. The FOMC hawks are eager to end the $120 billion QE program by mid-2022. If everything goes according to their plan, XAUUSD bulls will have a hard time. According to the president of the Federal Reserve Bank of New York, John Williams, there is no need to follow a certain time frame or the approach that was previously. Macroeconomic indicators are better than in the past. According to 40% of financial times experts, the Fed will announce QE tapering in November, 31% expect it in December. Experts have increased their forecasts for PCE from 3% to 3.7% by the end of 2021. Most of them expect inflation to continue to exceed the 2% target at the end of 2022.
Gold buyers should also fear the seasonal nature of COVID-19. Last summer, the epidemiological situation in the United States deteriorated significantly, while in Europe everything was more or less normal. However, in mid-autumn, the gap began to close. If history repeats itself in 2021, the slowdown in economic growth in the eurozone will deprive the euro of its main advantage and significantly lower the price of the EURUSD.
awesome chart breakdown, looks promising. Here's our idea as well
braingirl1994
⋅
Totally wrong. What the Fed does and what the Fed says are the opposite. The situation now is completely different from 2012 because everyone knows raising rates would bankrupt the federal and state governments. Even if the Fed tapers junk bond purchases, THE FED SET UP A STANDING REPO FACILITY TO SUPPRESS RATES. Now even non primary banks and foreign banks have access to Fed lending. So private banks, in search of yield, will go after riskier assets with the Fed having their back as the lender of last resort. Plus midterm elections are in fall 2022 and any interference will be lead to Congress abolishing the Fed and placing it under the Treasury....which eventually will happen. You truly have no clue what you are talking about.