Is Gold telecommunicating something to us?

 Another brutal day, another paid day for us!😋💰

 

  Now regarding what gold is telling us. You can easily notice from the chart below how much Gold has jumped in the past few days. It is a huge move. So it must have some implications behind it. For one, it is certainly related to the huge uncertainty from the banking sector melt-down.

More importantly, I believe gold is foretelling us that the Fed rate hike will be slowing down or even will pause soon. Immediately prior to this week’s banking turmoil, the overwhelming odds were on the Fed raising rates by 50 basis points next Wednesday. But after the banking sector melt-down, that went out the window. Majority odds are now on a 25-basis-point hike, with a minority expecting no hike. 

Here is my prediction for the week's market reaction to the Fed decision: Monday will usually be a down day per the typical prior Fed meeting pattern, followed by some bullish buying on Tue and Wed morning. Following the Fed announcement at 2 PM Wed, my hunch is that we will see a good deal of relief rally that may bring SPX above 4100, or even towards 4200 if the rally is strong enough. Next week will surely be very exciting as a huge inflection point is coming. Stay tuned!