The first step is to recognize the news related to the monetary easing The Fed or the provision of the stimulus (QE3) which is the focus of thinking the market participants over the main factors strengthening/attenuation u.s. Dollar and at the same time be aspects of Gold's appreciation against vs paper money.
The next step is to decide whether the news is really "new". Meeting of the members of the Board of the central bank of the United States (the FOMC) which set the direction of the US interest rate policy, and indicate openness of monetary easing opportunities are still very important. Why? because everyone has to know that the issue of the occurrence of bankruptcy Greece due to not getting a bailout and was forced to come out of the member of the EU is bad for gold and positive for the Dollar.
Reasonable if the weakening Gold sharp enough in the last week, due to the risk that cannot be taken lightly. Swept up in the scenario of the discharge of Greece of the single currency the Euro is the currency back to the Drachma devaluation of the drachma and the new by 50 percent, which would result in losses for Germany and France about 155 billion euros, a figure that is fantastic for the central banks of Western countries.
The danger is more threatening is the effect chain to private and public debt in peripheral European countries and France worth 15 trillion euros and if the banking assets in the European Union who hold the bonds of Greece 27 billion euros. So the Dollar strengthened sharply against gold, because the risk of triggering action events, the risk of investors to the Dollar.
But the FOMC minutes news was the first news that is positive for gold with respect to the factor of dollars. The news made the "new news". Other than that, the previous FOMC meeting in March, The Fed Board members agreed that the determination of the interest rate still depends on us economic data that in fact showed improvements, so that the opportunities for a monetary easing/provision of any corroboration of the stimulus is waning. Whereas the monetary easing factor is the locomotive for the Dollar and Gold as well.
The results of the FOMC minutes is
eventual "new news" which reverses all of the things that became the
focus of the market during this time. Such news would make the thought of the
market participants are becoming more positive, when political crisis Greece
they think is bad for gold and change psychological sentiment and give the
market confidence in Gold assets.
The next thing in the shape of "opinion" is to interview former staff of The Fed's Monetary Affairs Division, namely Roberto thing to. All over the world have been reacting to the story the FOMC and the Dollar.
Later in the interview directly with members of The Fed, said that the risk of bankruptcy of Greece will enlarge the opportunities of monetary easing of The Fed and the u.s. central bank's reference to loosen the monetary switch from indicators such as economic growth or inflation be the external risks could hinder recovery.
Thus ended the sentiment and psychological negative earlier in the gold, because the chances of monetary easing is a negative catalyst for Dollar. Readers should realize that we trade with probabilities. A smart investor will continue to try to find the things that are important in certain events based on specific probability of ekspetasi and make a decision based on the conclusion of transactions.
The FOMC makes a statement. Does it
sound positive to you – if it makes you feel confident with your position in
the market. Of course it was influential. Likely your reaction will also be
similar to the reactions of others as an investor.
What you feel will not be much different from other market participants. If the reader is surprised by the news, then the probability of his big enough if others will also feel surprised. If the reader does not feel surprised, then same thing also other market participants would feel.
In order to Transact safely Gold, investors also need to be prudent when market volatility which can trap, sometimes known as the "dangers of crowd behavior", the intent is to be a trend follower is indeed a pretty good strategy but worth scrutiny also when the trend has begun to expire Yes should we do not need to follow the trend of the old one, or simply we can analogikan with the behavior of his duck birds flying directions , i.e. when everyone already know that duck bird always flew toward the South when winter begins.
But when you see the bird suddenly changed direction to fly him even to the North in the winter, then you get a "new news", potentially moving the market.
