Welcome to another edition of “As the United States Federal Reserve turns”.  The Federal Reserve has promised transparency, and vowed to keep consumers aware of changes, parameters and timetables of our current quantitative easing program. However this,has  not stopped the push pull knee-jerk reactions that come from any statement issued by the fed. Today’s trading is an example of just that. After reaching a low of 1360 this morning gold prices moved up from their lows on use that the federal reserve bank of St. Louis Pres. James Bullard said that the Fed should keep its bond buying program, and adjust the size of it if economic conditions warrant.

This remark pushed the US dollar lower and pushed gold off of it slows to higher ground. Even with this upside push gold still closed off double digits, to close at 1377, down $18 at the time of this writing.

It is now up to the US Federal Reserve chairman Ben Bernanke, as tomorrow he will speak on the economy and monetary policy before Congress. This coupled with tomorrow’s release of the FOMC minutes should make trading activity interesting on Wednesday.

Although the bearish faction is firmly in control of gold prices, we have witnessed a potential technical support level between 1320 and 1340 per ounce. That being said I believe we should continue to see downside pressure in the market which could move prices back down to their support levels. But anything is possible when Ben speaks.

Wishing you as always good trading,

 Gary S. Wagner - Executive Producer