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Gold Near 4-Month Highs As FOMC Warning Sparks Buying Scramble In Stocks

Tyler Durden's picture




 

Stocks trod water for most of the day until the Fed said they would take the punhbowl away and that markets were complacent and that triggered buying in stocks, bonds, and gold. VIX was the catalyst (just as we saw at the actual FOMC meeting) and we would not be shocked to see a major volume dump after-hours in VXX (as dark pools unload their manipulations). The Dow ripped higher, desperate to reach 17,000 and prove that 'wealth' was back - but failed (although it did manage to get back to unch from the payrolls). Treasury yields limped higher, spiked higher on FOMC then dumped to the low yields of the day by the close (0-1bps lower on the day). Precious metals leaked lower into FOMC but spiked notably after with gold closing near 4-month highs. Oil was sliding into the minutes and did not bounce to close at its lowest in 2 months. VIX did its best to remind everyone that when the FOMC speaks, it's always good market news.

 

 

The Dow ramp fell short of its 17k target...

 

But did manage to get back to unch from payrolls (though the rest of the markets did not)

 

Stocks remain red on the week...

VIX did its best to remind everyone that when the FOMC speaks, it's always good market news.

 

The FOMC Minutes split the markets...

 

Treasury prices dumped and pumped on the FOMC news - closing unch to 1bp lower in yield

 

Commodities faded early but the post-FOMC reaction sent gold and silver soaring - gold near 4 month highs...

 

Charts: Bloomberg

Bonus Chart: Oil's dump and gold's pump has driven the gold cost of oil to its one-year average

 

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Wed, 07/09/2014 - 16:12 | 4940813 techstrategy
techstrategy's picture

As long as investors and particularly those on this site continue to sell the trading scam bubbles (NFLX, TSLA, AMZN) and use the proceeds to buy gold (physical, but GLD will have the same effect due to short interest being limited to underlying physical baskets), those who are playing the games are pinned.  It's check and nearing checkmate.

Wed, 07/09/2014 - 16:32 | 4940860 Deathrips
Deathrips's picture

The paper markets have the relevance of this statement.

 

"One time, I took a shit."

 

RIPS

Wed, 07/09/2014 - 16:13 | 4940817 TabakLover
TabakLover's picture

I dunno, lost a grand on some puts bot going into 2pm  (was up $300 at one point....but got greedy)..........but it just feels like something BIG is about to happen.  We'll see.

Wed, 07/09/2014 - 16:22 | 4940841 AccreditedEYE
AccreditedEYE's picture

Something BIG *is* about to happen: a blow off top to the moon.

Wed, 07/09/2014 - 16:57 | 4940935 disabledvet
disabledvet's picture

Real moon shots are okay. Financial ones not so much.

You can't say the Fed Chair didn't warn anybody and the Tylers are indeed spot on to warn "this ain't Cramerica talking." The folks in charge of the money have just fired a verbal warning shot. Their job is to know when things are out of whack...and the CEO's job is to listen to that warning as well.

"There's always a new debt product to be sold" of course. But that's for Wall Street not Detroit et al.

Wed, 07/09/2014 - 16:14 | 4940818 Stoploss
Stoploss's picture

Hey, the split markets chart looks like a big middle finger if you look at it a certain way..

Wed, 07/09/2014 - 17:20 | 4940993 CrashisOptimistic
CrashisOptimistic's picture

Oil and bonds say the same thing.  No growth.  No demand.

Stocks say a slightly different thing.  HFT.

That's all that matters.

Wed, 07/09/2014 - 16:17 | 4940826 Kaiser Sousa
Kaiser Sousa's picture

look at the moves over the last 3 days at exactly 10am in New York...
no REAL market trades the same way, the same times, in the same direction day after fuckin day... and check the Globex action as well..
i aint mad though...still got debt coupon dollars to throw away for real money...just sayin'.

http://www.kitco.com/charts/livesilver.html

Wed, 07/09/2014 - 16:19 | 4940832 NOTaREALmerican
NOTaREALmerican's picture

VIXXXXX.    Ahhhh,   VIXXXXXX......

Wed, 07/09/2014 - 16:20 | 4940835 LawsofPhysics
LawsofPhysics's picture

Tell me, what was the FOMC "warning" exactly?  Do they promise to shoot themselves in the fucking head?

Go ahead, raise rates  motherfuckers, enough jawboning already.

Wed, 07/09/2014 - 17:03 | 4940956 disabledvet
disabledvet's picture

Alan Grrenspan put his fears in the for of a question.

He said "how is one to know?"

And the market (in its madness) "moonshot the Nasdaq to 5000.

By the time that like of shit hit the fan the Nasdaq had bottomed at 1000!

"This was not a question." That says to me "ring fencing" to fellow policy makers as "Wall Street is doing it again." These phuckers are selling snowblowers in Saudi Arabia. "Caviar Emptor."

Wed, 07/09/2014 - 16:20 | 4940836 earleflorida
earleflorida's picture

Funny, FOMC quits in Oct/2014?

Even funnier, the ME is a saltpeter cauldron, with an unapoligetic islam fuse...  

Wed, 07/09/2014 - 16:33 | 4940861 Al Huxley
Al Huxley's picture

Gold's either anticipating the Indian budget tomorrow, or this is another set-up and the bullion banks have pretended to throw the ball for the dog, but actually have actually held onto it and and are hiding it behind their back, ready to crash the price with a couple of hundred tons dumped on the market overnight while the momo chasers race out to where they think the ball should be, and then look around dumbfounded when they discover it's not there.  That's the thing about dogs and gold momo-chasers, they never learn, no matter how many times the same trick's played on them.  Trick never gets old...

Wed, 07/09/2014 - 16:39 | 4940873 atoast2toast
atoast2toast's picture

Oil in Gold terms, Fartman would be proud

Wed, 07/09/2014 - 17:16 | 4940987 disabledvet
disabledvet's picture

Corn prices have totally collapsed. "That's a proxy for energy."

The whole Ag complex actually.
"That debt just became lot more debt."

Houston et al is exporting absolutely huge quantities of refined product right now. The Panama Canal will soon be not just be widened but opened to include an entirely new third lane.

That says to me you're doubling capacity.

If the same thing happens in Nicaragua "you're doubling the capacity again."

You could park 50 super Panamax vessels in Loiusianna no problem.

"Price discovery" will not be an issue once that happens.

Not that it is now either of course.

Wed, 07/09/2014 - 16:38 | 4940875 atoast2toast
atoast2toast's picture

Oil in Gold terms, Fartman would be proud

Wed, 07/09/2014 - 17:11 | 4940973 buzzsaw99
buzzsaw99's picture

nobody believes the fed. that's it in a nutshell. zero credibility.

Wed, 07/09/2014 - 17:57 | 4941106 TheRideNeverEnds
TheRideNeverEnds's picture

In fairness; why would anyone sell anything here?   The S&P is headed to 3000 by the end of next year 100% guaranteed, if you like selling em here you will love selling em over 3k.

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