New York (TheStreet) -- Gold prices are 2.5% higher this week following weaker-than-expected economic reports, but will likely remain unchanged heading into next week's Federal Reserve policy meeting, according to TheStreet's Joe Deaux. 

Andrew Chanin, co-founder of PureFunds, told Deaux the Fed might have something aside from tapering planned for the future. 

While many market participants largely expect the Fed to taper at some point, Chanin suggested the Fed may actually increase its bond-buying stimulus program, based on a report from Societe Generale.

He added that tapering appears to be off the table since the economy isn't growing at a high enough rate -- especially not one that warrants the Fed backing out. 

Based on the current environment, he suggested the odds of an increase in quantitative easing rather than a decrease are increasing. 

As for gold prices, tapering appears to be priced in, according to Chanin. But what isn't priced in is an increase to the stimulus program.  Should the Fed increase bond buying, it will drive prices of the yellow metal higher. The Fed's policy is what fueled prices higher a few years ago, he said.

Chanin concluded that gold has already priced in the downside move but has yet to price in the upside potential since an increase to stimulus is not a widely held view.  

-- Written by Bret Kenwell in Petoskey, Mich.

Follow @BretKenwell

Bret Kenwell currently writes, blogs and also contributes to Robert Weinstein's Weekly Options Newsletter. Focuses on short-to-intermediate-term trading opportunities that can be exposed via options. He prefers to use debit trades on momentum setups and credit trades on support/resistance setups. He also focuses on building long-term wealth by searching for consistent, quality dividend paying companies and long-term growth companies. He considers himself the surfer, not the wave, in relation to the market and himself. He has no allegiance to either the bull side or the bear side.

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