Cyprus gets its last minute bailout
Even though Comex $1,600 strike options expired yesterday, gold is still gravitating and consolidating around this level. Volatility has sold off a tad as gold remains range bound ahead of the upcoming Easter holiday weekend. Considering that this is a short week and that the electronic trading platform to hedge will be closed on Good Friday, we expect the precious metals to trade quietly for the next few days. There may be some slight pressure on the precious metals as producers look to unload inventory before the end of the quarter. To the upside, gold will find offers materializing ahead of the 50 day moving average at $1,625.50. Support is coming in at the low from yesterday of $1,590 which also happens to be a Fibonacci retracement level.
The Cypriot President Nicos Anastasiades stated that his country was “a breath away from economic collapse” before its last minute bailout over this past weekend. Cyprus agreed to a €10 billion international rescue package which includes stipulations of losses for depositors at the island’s two biggest lenders. Unsurprisingly, banks will remain closed until Thursday now. Physical precious metal holders should be feeling pretty good considering how this Cyprus situation is playing out.
