Gold jumps as market jitters soar

Investing.com - Gold futures rose during Tuesday’s Asian session following the worst performance by stocks U.S. stocks since November 2012 during Monday’s U.S. session.

On the Comex division of the New York Mercantile Exchange, gold futures for April delivery rose 0.63% to USD1,596.60 per troy ounce in Asian trading Tuesday. Gold is seen building on an impressive performance notched during Monday’s U.S. session when bullion settled up 1.09% at USD1,590.00 a troy ounce in U.S. trading on Monday.

Gold futures were likely to test support USD1,554.80 a troy ounce, Thursday's low, and resistance at USD1,618.70, the high from Feb. 18. Gold slipped to a seven-month low of USD1,554.49 per ounce last Thursday.

Bullion caught a bid Monday on speculation that Federal Reserve Chairman Ben Bernanke will downplay inflationary side effects of the U.S. central bank's loose monetary policies. Bernanke is set to deliver monetary policy before the Senate Banking Committee later today. The Fed chief will deliver similar testimony before the House Financial Services Committee on Wednesday.

Last week, gold bugs were sent running for cover on speculation that the Fed is mulling winding down or bring to an end its USD85 billion-a-month bond-buying program known as quantitative easing.

Even the dire performance of European equities in the wake of the U.K. losing its AAA credit rating and the complexity of Italian election results was not enough to stop gold’s Monday rally. Exit polls showed former Prime Minister Silvio Berlusconi’s conservative party with a chance of capturing a majority in the Italian senate.

That could be enough to scare markets and investors that austerity implemented by current Prime Minister Mario Monti could be undone, hastening Italy’s departure from the euro zone. Italy is the region’s third-largest economy.

Elsewhere, Comex silver for May delivery rose 0.38% to USD29.158 while copper for May delivery rose by the same amount to USD3.562.