Over the last couple of days, market participants have been analyzing and absorbing recent statements and actions initiated by the Fed at the conclusion of this month’s FOMC policy meeting. Analysts continue to parse the press release issued by the Federal Reserve, along with statements made by Chairwoman Janet Yellen during her news conference which followed the policy meeting.

There’s a new Sheriff in town, spreading hawkish sentiment wherever she goes. Chairwoman Janet Yellen is not actually a new Sheriff, but statements she made at yesterday’s news conference, coupled with the press release issued by the Federal Reserve, reveal a much more aggressive stance by the Fed.

As anticipated, at the conclusion of today’s FOMC policy meeting, the Federal Reserve announced that they would raise interest rates by 25 basis points (¼%) to take the Fed funds rate effectively between 1 and 1¼%.

With great anticipation, traders and investors await the conclusion of tomorrow’s FOMC meeting. It is anticipated that the Fed will announce an interest rate hike at this time. Immediately following the conclusion of tomorrow’s meeting, Janet Yellen will hold a news conference.

With the FOMC meeting scheduled to begin tomorrow, market participants have continued the bearish market sentiment so prevalent last week. Since reaching a high just below $1300 on June 6th, gold prices have traded lower. Gold prices have continued to decline for the last four consecutive trading days.

Gold had been trading dramatically higher from the recent low of $1215 achieved on May 9^th. Over the last month, gold pricing had gained roughly $84, trading at a new yearly high on Tuesday of this week, when prices reached $1298 per ounce. This price point was a little more than a dollar above the former yearly high achieved during the week of April 17^th.

Two key events occurred today which have had an adverse impact on gold prices, being cited as underlying factors for today’s dramatic selloff. Beginning in Europe, the European Central Bank (ECB) held a monetary policy meeting which resulted in unchanged interest rates. This put selling pressure on the Euro dollar and was, therefore, favorable for the U.S. dollar.

Today the former director of the FBI, James Comey, released a written transcript of the prepared opening statement he will make tomorrow in his testimony to the Senate Committee on Intelligence. This seven-page document details the former director’s contact with President Trump, going over his interactions meeting by meeting, phone call by phone call.

A trifecta of geopolitical events on Thursday, along with a weaker U.S. dollar and recent weak U.S. economic data, have all contributed as underlying factors taking gold future prices to a new yearly high. 

Today precious metals prices have remained firm in a narrowly defined range, trading modestly higher. Market participants await the unfolding of three distinct events that will undoubtedly influence future pricing. Until then, traders and investors will be in a holding pattern, characterized by a wait and see attitude as events develop.