Trade in Gold was rather uninteresting yesterday

Trade in Gold was rather uninteresting yesterday. Bernanke’s testimony to the House Budget Committee did spark some volatility, although ultimately prices ended the day mostly flat. As expected, Bernanke’s statement revealed nothing new about the Fed’s stance on the US economic recovery and its commitment to monetary accommodation.

Although risk appetite appears to waning, investment demand for precious metals is not forthcoming. Physical demand too, especially in Asia, remains on the sidelines. With little buying to counter it, a resurgence in the dollar is pulling the complex down, exacerbated by some light profit-taking. Perhaps the lack of interest in China, after the return from holidays, is also contributing to investor unease. While we only expect a pick-up in Chinese trading from Monday, we would caution that there is a risk that this will disappoint.

As always US jobless claims data might prompt some price action, with disappointing numbers providing limited lift. Gold support is at $1,357 and $1,352. Resistance is at $1,367 and $1,372.

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