"Yellen's Statement is Incorrectly Interpreted" - Veteran Trader

One veteran trader says there is every reason gold should be higher, especially as the metal has made its way back near the $1,220 level.

Author:: Daniela Cambone
Publish date:: Jul 13, 2017 4:30 PM EDT

KITCO NEWS -- One veteran trader says there is every reason gold should be higher, especially as the metal has made its way back near the $1,220 level. "As long as we can maintain this week's momentum, we could go further," said Todd 'Bubba' Horwitz of bubbatrading.com. August Comex gold was last down $1.40 an ounce at $1,217.70. September Comex silver was last down $0.177 at $15.71 an ounce. Fed Chair Janet Yellen spoke again today in front of the U.S. Senate. Her question-and-answer session was monitored closely, but her remarks were not much different than those she delivered to House committee members the day prior. On Wednesday, Yellen sounded a surprisingly dovish tone on U.S. monetary policy, which rallied many markets and gave gold and silver a slight lift. "Yellen's statement was dovish indicating that they were going to slow on hiking rates, which is being incorrectly interpreted. The second part of the statement was that the Fed would start liquidating their bond positions, which is the same as a backdoor rate hike. Bonds go down, rates go up," Horwitz explained.

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This article is commentary by an independent contributor. At the time of publication, the author held TK positions in the stocks mentioned.