Following two days of meetings the Federal Reserve still will not accommodate the market’s wishes for further quantitative easing. As a result, markets that rely on FED actions or at least have relied on those actions for the past year, talking about gold and silver here, are finding it difficult to move higher with gold shedding $10.00 an ounce in today’s action followed by silver losing another .18 cents per ounce. If anything over the past month and a half, it appears though that the highly volatile speculation in those markets has abated thus making the market easier to navigate.

The Fed is still embarking on a continuation of operation twist until the end of this calendar year but did not speak about further easing although Fed Chairman Ben Bernanke did indicate that the Federal Reserve remains at the ready should market conditions warrant accommodative measures. The market opened higher but failed to hold any gains as market participants were faced with the reality that the Federal Reserve will not be backstopping the markets for the time being.

Market participants are watching words very carefully and playing with semantics. The last Fed meeting gave us the Fed stating that they would "regularly review the size and composition of its securities and will adjust the holdings as appropriate to promote a stronger recovery”. The language used by the Fed this time was that they were “prepared to take further action”. However that was the same language used 2 months ago so I fail to see why traders would hang their hats on any false hope at the moment.

I remain convinced that we will not see any major market action until either closer to or following the elections set for this fall.

On the overall economic picture, the Fed said that they expect growth of 1.9 to 2.4% down from the previous 2.4-2.9% estimate. Growth for 2013 was also trimmed to 2.2 – 2.8% from the previous 2.7 to 3.1%. My question is that with positive growth still on the horizon, the Fed is really at a stage where they aren’t forced to move into the markets in any aggressive way. As a result, it is my view that the metals will still continue to trend downwards perhaps breaching my previously noted levels on their way to much lower levels. Remember they rose because of QE and without additional easing in the mix, I fail to see what the catalyst for further upside movement is.