All the talk in the market in the moment is about the Volcker Plan. It’s the plan the Obama administration released two weeks ago that called to end prop trading at banks with commercial clients. The latest chatter is that it’s off. The plan will be eliminated or scaled down. The plan was fraught with hurdles and it was a big negative for banking profits. As the chatter circulated, stocks made a late-day rally and risk appetitite shot higher.
One of the big winners was gold. It rallied more than $25 and broke key short-term technical resistance at $1104. It also traced out a massive outside reversal day and put in a double-bottom at $1074. The measured target of the double bottom calls for a new record high, or at least a test of $1220. The upside would be confirmed by a push above the downtrend line that comes in at $1120 today.
