When I left the office yesterday for the comforts of my home, gold prices was trading at a respectable $1780 per ounce. But when I reached the office this morning and opened the trading platform, I was left speechless by the downturn in the fortunes of the gold’s prices-$1718 per ounce. As I further investigated into the correction, I found out that the gold’s prices had reached the lowest price of $1687.61per ounce before breaking into the $1700 levels again. Amongst the scores of reasons responsible for the dramatic collapse in the fortunes of gold prices, one reason stood tall-Bernanke’s Speech.

The Federal Chairman, Ben Bernanke dealt markets a surprise on Wednesday when his comments during the first of two days of Congressional testimony suggested that another round of easing may not necessarily be on the cards. This comment accounted for the lowering of the stocks, the strengthening of the greenback and beating down of the precious metals to their worst correction in more than two months. Wow! Some speech I must say.

Traders opine that it was more about what Bernanke didn’t say than what he did. It was a different testimony as compared to the previous ones as he downplayed the appropriateness of more aggressive easing through QE3. Fed officials have signaled the Fed could purchase mortgage securities in a further easing round, instead of the dreaded Treasury’s, if the economy needed help. Many analysts believe just the idea of more QE has been a factor behind the rising stock markets and commodities prices.

Bernanke did say that the job market is far from normal, and he warned that fiscal tightening could impact the economy. As expected, he stayed cautious on the economy and said the ongoing recovery was uneven and modest.

Besides Bernanke’s speech late on Thursday night, the focus will also be on Europe where EU finance ministers and leaders meet at a summit. Talks are set to focus on the euro zone agreement on tighter fiscal integration. But if last night’s speech was anything to go by, expect the same when Bernanke steps onto the platter this time too. Watch out Traders!

Note: The blog is just an expression of the author’s opinion and cannot be deemed responsible for any losses incurred.