- MCX Gold Tips For Today: Sell 57350—57450 (Sell 50—100 Lots) or So Jaao Target 500—1000—1500 Points. Trading Tips By Neal Bhai, INDIA
Gold Price is two-way over the European Central bank interest rate decision. The initial reaction to the 50 basis point Refinancing Rate hike was a drop to test $1,907 before returning to $1,932.
ECB Rate Hike
- Main refi rate at 3.50% vs 3.00% prior.
- Raises interest rate on marginal lending facility to 3.75% vs 3.25% prior.
- Deposit facility to 3.00% vs 2.50% prior.
ECB statement key notes
- Refrains from signalling future rate moves in statement.
- Inflation projected to remain too high for too long.
- Headline inflation expected to average 5.3% in 2023, 2.9% in 2024 and 2.1% in 2025.
- Forecasts done before market turmoil.
- Elevated level of uncertainty reinforces importance of a data-dependent approach to ECB policy decision, which will be determined by its assessment of inflation outlook in light of incoming data and dynamics.
- Banking sector sector is resilient, with strong capital and liquidity positions
- Policy toolkit is fully equipped to provide liquidity support to eurozone financial system if needed.
Meanwhile, markets are now pricing the terminal rate at 3% and the Euro is under pressure.
Markets will now turn to the ECB Governing Council Press Conference:
Spot Gold Technical Forecast
The Gold price broke the structure to the upside on Wednesday and we are seeing some consolidation of that. However, should the support near a 61.8% Fibonacci retracement hold, then with bullish commitments, we could see an extension of the bullish trend unfold in the coming hours/sessions with $1,942 eyed.