by Frik Els:
The gold price added to recent gains on Tuesday to reach a three-week high, but fell short of the crucial $1,300 an ounce level.
Gold futures were changing hands at $1,290 in late afternoon trade, after earlier hitting an intra-day high of $1,295, ahead of testimony by the US Federal Reserve Chairman Ben Bernanke in front of the US Congress on Wednesday.
Gold investors will be looking for clues from Bernanke about the future of the central bank's quantitative easing program.
Fears that the Fed may start to dial back its asset buying program that adds $85 billion of cheap money to financial market each month as soon as September, has effectively put a ceiling on the gold price as it attempts to recover from near 3-year lows hit late June.
The softness in the gold price comes despite surging demand in China as evidenced by the premium traders on the Shanghai Gold Exchange are willing to pay for the metal. ...