How The Fed Decision Impacts Commodities

The Fed released their decision on interest rates yesterday and it is business as usual. This means they will keep interest rates near zero for the foreseeable future, which does absolutely nothing to help the dollar. Does this mean the same theme of a lower dollar and higher commodities will resume?

I'm sure the "short the dollar and long commodities trade" will pickup once again. The markets have an enormous appetite for risk, because it is apparent that the Fed and the government will give the markets everything they want. This is a liquidity driven market because of those reasons and it will be interesting to see how far traders take it to an extreme.

That being said, there is still a top in the commodities and stock markets that should hold. We are in strange times and there is no telling what will happen. The gold market is making quite a statement trading near $1,100 an ounce. However, the commodity indexes are consolidating below their highs. The dollar will have to make a strong break lower if commodities are to make new highs.