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Commodities Brief – Precious metals await Bernanke testimony, Gold finds resistance at 1600

Gold prices made a run at the vaunted 1600 barrier and resistance (1601.65 daily maximum), however the price could not hold above this figure and pulled back shortly after, spending the European session in flux. After ranging as low as 1591, the yellow metal has rebounded at the onset of American trading, as investors are all waiting for the remarks from Fed Chairman Ben Bernanke at 15:00 GMT. Fundamentally, gold looks good, as it is being supported by its 20-day SMA. At the time of writing, the price has settled at USD $1595.64 per oz., up +0.57% Tuesday.

Silver prices have experienced the same uneven behavior today, as overnight and European trading has caused the white metal to range between 28.76 (session low) and its initial 29.00 opening figure. As a cheaper alternative safe haven currency, clearly the direction and overall dovishness of the Fed will play a role in short-term prices. However, silver remains constrained by strong resistance at the 29.00 barrier, and in these moments the price is trading negatively at USD $28.91 per oz., down -0.27%.

WTI Crude briefly peaked at an intraday maximum of 93.18 in recent moments, before waning slightly back towards USD $93.00/bbl level. Currently, it has found traction this region at and is testing this mark during the time of writing Tuesday.

Session Recap: Majors consolidate after dramatic price action

The European session has seen consolidative moves in major crosses after the market was shaken by concerns over Italian election outcome. Meanwhile, Fed Bernanke's semi-annual testimony to the Senate Banking Committee at 15:00 GMT is the main focus of the day. The dollar is mixed, although most pairs are hovering around their opening levels. EUR/USD fell below 1.3100 for the first time since early January and now consolidates around 1.3080, having set a low of 1.3017. USD/JPY traded as low as 91.40 but is now back around 92.00. GBP/USD failed to hold above 1.5200 and it is now virtually unchanged at the 1.5160 area.
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Forex Flash: USD/CAD may drop on Fed Bernanke's testimony – TD Securities

More than headlines coming from Italy, the main pressure for the CAD is soft domestic fundamentals that have considerably disappointed recently. “Yesterday’s acknowledgement by Governor Carney only added to sentiment extending USD/CAD gains to fresh 2013 highs”, wrote analyst Shaun Osborne and Greg Moore, pointing to Bernanke’s testimony today has potentially CAD positive as Fed's Chairman is expected to downplay the notion of the impending end of QE. “However, Friday’s Canadian GDP report should reinstill the negative CAD theme”, they added.
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