Pressure On Gold Continues this Morning

The Market Gage - Dillon Gage's Precious Metals Newsletter

Continued pressure hitting the price of gold and silver this morning as the realization is setting in that more than one rate hike is a good possibility in the coming months. The price of gold still above the 100-day moving average at $1,218.60 spot and above, which is where Wall Street traders last bought in at $1,220.00. If we break thru these two levels, I expect the selling to accelerate and possibly test the $1,200 dollar level. My hope is that some good news enters the market place and we consolidate here

Always watching the CME Watch tool odds. Today’s odds on the board for a rate hike in March stand at 77.5 percent. I believe the street already has it as a done deal.

If I told you that there were outflows in the Gold ETF overnight you would have said that was expected but surprisingly the Gold ETF was up once again over 76,000 .ounces. Some group of investors just doesn’t want to give up on a gold even at these levels which is music to my ears.

So I’m watching very closely the levels I mentioned previously and hoping we stay afloat at these levels. Obviously there are folks out there that believe we will. Should be an interesting trading day.

Now some other news I’d like to share with you.

The French Presidential election an update:

The first round of the French Presidential election will be held on April 23rd. In the event that no one candidate wins the majority, ( and that’s what’s predicted ) a run off an election will be held on May 7th.

According to the polls leading the way is Ms. Marine Le Pen the leader of the National Front Party (and as I like call her ) the candidate of the” global Gold investor”.

Ms. Le Pen is facing four other candidates:

  • Mr. Francois Fillon Republican Party
  • Mr. Benoit Hamon Socialist Party
  • Emmanuel Macron Onwards Party
  • Jean-Luc Melenchon Left Party

Currently Ms. Le Pen is leading in the polls with over 26 percent of the vote, so a run off with the second leading vote getter is inevitable.

I’m sure you are asking yourself why do I call her “the candidate of the global Gold investor”?
Here’s why. Ms. Le Pen has over and over again said that if elected she will abandon the Euro in favor of a new Franc and within the first six months of her Presidency hold a referendum to leave the European Union. Obviously she will need the French Parliament’s approval.

Nonetheless, just the threat of this happening (as with the Brexit news) will have an impact on global markets. The European Community cannot afford to have another strong economic participant leave the EU. That will leave Germany holding the “bailout bag” for the likes of Italy, Greece, Portugal and Spain. All four countries are in bad shape, hanging around with both hands open waiting for more help from Germany and the IMF.

At this point no one knows how this will play out and, as a matter of fact, most people in the know say she has no shot going head to head with any of the other four candidates. But reportedly in some polls there are still many undecided voters and some who observers say might change their minds. That’s why many say don’t count her out as she continues to gain momentum.

To say the least, it would be very interesting to see how this plays out because in my opinion if she is elected the existence of the EU could be in question.

I’ll keep you posted.

Have a wonderful Friday.

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.