Precious Metals Gold was steady to higher through the far East and most of London trading yesterday, but at about 9:30 of the New York session it plunged, bottoming at $877 before it climbed through the NYMEX, only to sag again in the Globex and finish at $881.30/oz., down $9.00. Overnight, gold has fallen off.

Platinum was up, peaking at $2040 in late Hong Kong trading, but it slid in Europe, and plummeted in New York before recovering most of its lost ground to end at $2003/oz., down $4. Overnight, platinum has been trending lower.

Silver tracked gold, skidding from $16.90 in London to as low as $16.50 in New York, but it staged a better turnaround than gold, moving sharply higher to close at $16.77/oz., down just 2 cents. Overnight, silver has declined. (Click here for charts)

It was a predictable day for the metals, since the usual suspects moved against them, with the dollar rising and oil prices coming off.

But one didn?t have to look far for the main reason for either the buck?s strength, crude?s drop or gold?s early weakness. ?The proximal cause of today's drop in gold was ... Bernanke's comments regarding commodities and the dollar,? wrote Brien Lundin, editor of Gold Newsletter. ?

The fact that he broke ranks with tradition and addressed the status of the dollar -- which is the Treasury Secretary's bailiwick -- was remarkable enough to send a shudder through the gold and currency markets,? Lundin added. Equally remarkable, perhaps, was the fact that gold did make at least a partial recovery from the plunge brought on by Big Ben?s remarks, while silver was barely down at all by day?s end.

But, no surprise, Kitco?s Jon Nadler accentuated the negative, writing that ?comments by the Fed chairman echoed the sentiment that an unwelcome rise in inflation had raised the central bank's levels of concern.? Bernanke has drawn ? ?a line in the sand? as to the amount that the dollar could or should fall by, [and] effectively obviates the 'death plunge' in the currency that oil and gold had been eagerly awaiting since September,? Nadler said. Thus, ?the risk to the downside for gold has now been significantly augmented once again,? Nadler concluded.

But Mark O'Byrne, a of Gold and Silver Investments Ltd., might have been countering that very argument when he said that ?no amount of jawboning by Bernanke or anyone else will help rectify the huge fundamental headwinds facing the U.S. economy in the face of a housing crash, huge deficits, huge credit and systemic risks and the increasing reality of stagflation.?