GD: Gold To Rally Year End As Traders Close Some Of Record Short Positions
Gold is marginally lower today after two days of gains as the Fed's two day policy meeting begins. More positive than expected U.S. data and continuing SPDR outflows may have led to weakness.
Gold's gains in recent days are likely partly due to a short covering rally. Nervous traders may be closing some of their record short positions ahead of a Federal Reserve policy decision on whether to begin tapering its equity and bond friendly debt monetisation measures.
Most economists believe the Fed will not begin tapering till March of next year, which could be prompt traders to further cover their short positions.
