The Cut That Wasn't

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- The Fed refused to close the doors on any policy options as it tries to ensure that the economy is first revived.

The above now leaves some room, and one more opportunity for gold to try to get back to a level nearer to $900 before the summer doldrums set in. The background picture remains less than conducive to a full resumption of the bull track, but it will give the expected knee-jerk buy gold/sell dollar scenario to trade upon. The bigger question is, for how long? Barring some really bad news from the financial sector, we are of the opinion that we have just seen the bottom of this rate cut cycle. Thus, as mentioned yesterday, gold now has to make a go of it on its own - it cannot count on more rugs being pulled from under the dollar with any certainty. Surely, not the certainty that has ruled since September 2007, and became an addiction.

Happy Trading.