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Gold: Off lows ahead of ECB rate decision

Discussion in 'Fundamental Analysis' started by FXStreet_Team, Mar 10, 2016.

  1. FXStreet_Team

    FXStreet_Team Well-Known Member Trader

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    Gold prices have recovered slightly from the daily low in anticipation of an interest rate cut and a possible expansion of the QE program by the ECB.

    Hovers around 10-DMA

    Prices currently trade around 10-DMA located at $1249/Oz levels after having clocked a low of $1245 levels. Traders expect a 10 basis point deposit rate cut, which is already priced-in. Nevertheless, the metal has moved off lows ahead of the rate decision.

    Furthermore, Gold is directly related to balance sheet expansion of major central banks; hence, possible expansion of the QE program is also helping the metal recover losses.

    Gold Technical Levels

    The immediate hurdle is seen at 1253.32 (Feb 24 high), above which prices could test 1263.36 (Feb 11 high). On the other hand, a break below 1242.95 (previous day’s low) would open doors for a drop to 1220 (Feb 19 low).
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