Gold Building a base. “The rally was part short covering and part the ignorance of the ECB actions” – By Todd Horwitz, Bubba Trading

 


Thursday, Super Mario Draghi in his swan song as the head of the ECB cut rates and added more Quantitative Easing. That action sent the Gold markets soaring higher pushing the yellow metal up almost 30.00 before settling about 5.00 higher for the day.

The fear and panic of gold collapsing has subsided for now and the 1500 level December futures held. The rally was part short covering and part the ignorance of the ECB actions. Next up is the FED and what they will do with rates.

While markets are pricing in a .50 bps cut, President Trump wants more the bond markets are telling a different story. The pounding of bond futures signaling higher rates suggests that the rally in gold Thursday was as much short covering from those who had panicked to uncertainty of the global economy.

Just remember price dictates everything, as long as 1500 holds gold will go higher, it’s that simple.

Todd Horwitz
Chief Strategist
BubbaTrading.com

Financial Markets and Political Commentary
 

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About the author

Todd Horwitz - Author of “Average Joe Options“. Todd began his trading career in 1980 at the CBOE. He was one of the original traders in the OEX & helped start the SPX. He is a member the CME where he trades S&P futures as well as foreign currencies & is a regular contributor to CNBC, Bloomberg, BNN, Fox & many other major news networks.