Resistance For Aug. Gold at $1,662, $1,680

 If Comex August gold tops the psychologically important $1,600-an-ounce level, two of the next chart resistance points would be around $1,662 and $1,680 an ounce, says MF Global. The metal, already supported by European debt issues, was further boosted the last couple of days by Federal Reserve commentary suggesting more fiscal stimulus may be necessary. More support came late Wednesday when Moody’s Investors Service put U.S. debt on review for possible downgrade. Technically, August gold has broken above the June 22 high of $1,559.30, as well as the top of a bullish triangle pattern drawn over the trade in May and June, says MF Global analyst Tom Pawlicki. “The triangle projects a further rally of $112/oz, or $1,662,” he says. “A Fibonacci pattern drawn off the Jan. 28th-May 2nd uptrend projects an advance toward the 138% extension at $1,680.”

While QE3 Possible, Fed Still On Hold For Now

Federal Reserve Chairman Ben Bernanke’s congressional testimony Wednesday was construed by markets as a sign that policy-makers might be moving closer to further stimulus, but some analysts are offering caution. The Fed likely is still on hold for now, and whether it embarks upon a third round of quantitative easing will hinge on future economic data, they say. “Our economists retain the view that while QE3 is possible, the probability is considerably less than 50%,” says BNP Paribas’ currency team. “The core of the FOMC remains in wait-and-see mode, dependent upon incoming data over the next couple of months to confirm or refute their projections for an end to the soft patch--and thus an early resolution to the issue of QE3 is unlikely.” Barclays Capital says: “Given generally stable medium-term inflation expectations and low deflation probabilities, QE3 speculation is a bit premature, in our view.” Brown Brothers Harriman notes that while Bernanke outlined how more stimulus might occur, recent comments also suggest “that the bar for QE3 is very high.”