A simple look at various markets would tell you hawkish rhetoric failed to materialise, with good buying seen in equities and bonds, while the USD was sold off against high yielding currencies.
My own personal belief is that the Fed’s new projections on growth (to 2.2% for 2014) could be revised higher as we enter the latter stages of the year, although much will be determined on how a number of developing geo-political issue evolve.
It’s also interesting to see the Fed lift its funds rate (interest rate) projections for 2015 and 2016, with the market showing no concern whatsoever and failed to lift the USD at all.
Following on my potential trade idea yesterday, looking at the daily chart, momentum suggests higher levels could be seen, however key resistance is seen between $1282 and $1285. This is where the April downtrend, 55- and 200-day moving averages converge.
The Fed may have masked developments in Iraq; however with Brent prices pushing above $114, this could inspire gold bulls to push the price above this supply.