However, I remain happy to maintain a bearish tone on the previous metal heading into the testimony. The question now is whether Yellen can survive the wave of criticism the Fed’s bond-buying programme is likely to face from politicians. She will really have to justify maintaining the programme at the current pace as the Fed’s balance sheet blows out to $4 trillion.
As a result, Yellen might actually play the fence to an extent in a bid to keep everyone happy. Should Yellen come in less dovish than the market is now positioned for, then gold is likely to reverse lower.