STOCK MARKET WATCH -- Thursday, 21 February 2013

[Demeter]

7. U.S. stocks slump after Fed minutes

U.S. stocks fall from multiyear highs as investors react to conflicting views from the Federal Reserve on its monetary policy.

http://www.marketwatch.com/story/us-stock-indexes-edge-lower-2013-02-20

U.S. stocks fell sharply on Wednesday, retreating from multiyear highs, after minutes from the Federal Reserve’s last meeting illustrated differing views over continued stimulus.

“If the Fed is talking about ending its asset-purchase program, it’s because they view the economic landscape as better,” said Dan Greenhaus, chief global strategist at BTIG LLC.

FAR MORE LIKELY THE FED HAS DECIDED IT DOES MORE HARM THAN GOOD...

Gold sinks below $1,600 amid ‘death cross’ talk

Gold futures tumble below $1,600 an ounce Wednesday, pressured by strength in the dollar to settle at their lowest since late July, just ahead of the release of minutes of the U.S. Federal Reserve’s January meeting, as talk of a so-called “death cross” in gold prices spooks investors.

http://www.marketwatch.com/story/gold-inches-higher-ahead-of-fed-minutes-2013-02-19

... A death cross is “a crossover resulting from a security’s long-term moving average breaking above its short-term moving average or support level,” said Chintan Karnani, an independent bullion analyst based in New Delhi. “Additionally, the long-term moving average becomes the new resistance level in the rising market.” In layman’s terms, “this implies that gold’s long-term bull run is over and that it could be in a bear phase,” he said. “Fundamentals are there as investors are shunning gold exchange-traded funds. Indian gold demand is not there due to a nationwide strike today by workers.”

The death cross hasn’t been reached because both moving averages need to be moving lower, said Ross Norman, chief executive officer of Sharps Pixley. Gold ‘death cross’, if there is one, is not gold’s only problem. Even so, the truth is that “gold has been weak for a while and bears exploited it,” Norman said. Gold’s not necessarily in a long-term bearish trend, according to Karnani.

“In the past, gold has reversed many times between $1,530 and $1,550,” said Karnani. “For gold to be in a long-term bear trend, it needs a daily close below $1,520 for a week,” he said. “The next one week is very crucial for gold prices. I am optimistic and do not expect gold prices to fall below $1,470 under the worst-case scenario....”


Fed, uneasy over ‘QE,’ plans bond-buy debate

The Federal Reserve will consider major changes to its quantitative easing program at its next meeting in March. Ideas on the table including varying the pace of the $85 billion per month purchases, or ending them. One new idea would have the Fed maintain the size of its balance sheet longer than expected...

http://www.marketwatch.com/story/fed-plans-debate-on-bond-buys-minutes-show-2013-02-20