The ECB has cut its benchmark interest rate from 0.05 to ZERO as part of a extensive program to help the failing European economy. Also announced, the ECB will increase it quantitative easing program from 60 bn Euro a month to 80 bn Euro a month.
They also decided to cut the bank deposit rate from minus 0.3 pct. to minus 0.4 percent which costs the banks more to deposit cash with the central bank.
At the time of this report we see the Euro hitting a low of 1.0823 and the dollar index up almost one big figure at 98.25.
The stronger dollar hurting the price of gold this morning as we witness red numbers for the third day in a row. Surprisingly, we see another increase in the Gold overnight ETF holdings now standing at 56.7 million ounces.
Gold trading above $1,250 level after European sellers early this morning took gold in the April contract
to $1,237.50. Technical support level now at $1,246.00. In my opinion we must hold this level in order
to see Gold continue its upside momentum.
Have a wonderful Thursday.
Disclaimer: This editorial has been prepared by Walter Pehowich of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.