NEW YORK (TheStreet) -- Once considered a long shot, tapering of the Federal Reserve's asset purchases in December seems to be gaining traction.
TheStreet's Jill Malandrino spoke to independent trader Ross Greenspan about this, and he said gold prices continue to struggle while equity prices are near all-time highs. But the biggest concern comes from interest rates, which are creeping higher.
Greenspan also suggested that it's hard for the Fed to justify not tapering at this point, as positive economic data continue to pour in each month. This week's third-quarter GDP revision and nonfarm payrolls report will have significant implications for investor sentiment towards a potential tapering announcement.
The widespread opinion is that the Fed will taper in February or March, Malandrino said. Greenspan added that if a "no taper" announcement is made this month, gold prices could shoot higher.
He said the sentiment for the metal is terrible right now, which could cause a short-covering rally should the Fed keep its stimulus plan unchanged.
However, if there is a tapering announcement, Greenspan said rates on the 10-year Treasury bond would hit 3% relatively soon, and could reach 3.25% to 3.5% by mid-2014.
-- Written by Bret Kenwell in Petoskey, Mich.