(Kitco News) --The Federal Reserve chairman’s assessment of the economy on Friday did little to change the view of most gold traders and analysts that the metal is likely to continue working its way higher in the weeks ahead.

Speaking at a Kansas City Fed symposium in Jackson Hole, Wyo., Fed chief Ben Bernanke commented that the pace of recovery has slowed but he still looks for economic growth in the second half of the year and next. He also said officials will “strongly resist” deflation and still has tools in its arsenal to try to jump-start the economy, if needed.

Gold trended higher much of this month on economic uncertainty, with some investors turning to the metal as a store of value.

“He’s standing at the edge of the pool and making sure everything doesn’t get worse,” said Daniel Pavilonis, senior market strategist with Lind-Waldock.

But as long as economic jitters persist, gold is likely to rise further, Pavilonis continued.

“It’s because of economic fears and fears of a double-dip recession,” Pavilonis said. “You are seeing a flight into quality into gold.”

Prices oscillated but did not make a massive move on Friday. At 1:50 p.m. EDT (1750 GMT), December gold was 20 cents higher at $1,237.90 an ounce on the Comex division of the New York Mercantile Exchange. Shortly afterward, spot gold was $1.50 higher at $1,237.80.

Michael Gross, broker and futures analyst with OptionSellers.com, suggested the Fed chief was bracing Americans to expect a modest recovery. That does not bode well for the longer-term outlook for the stock market, he said.

Gross looks for gold to hit $1,300 an ounce by year-end. “If anything, it (Bernanke’s speech) seemed to reinforce that,” Gross said.

While some worry about further economic weakness, others fear that stimulus measures will eventually trigger worrisome inflation, said the head of one metals-trading desk. Soft data may also prompt further weakness in the U.S. dollar, which tends to underpin gold due to their inverse relationship.

 “The market has been poised with a bullish stance for the last couple of weeks,” the trader said. “His comments haven’t changed anything.”

Meanwhile, Ken Morrison, founder and editor of an online newsletter, Morrison on the Markets, described himself as neutral on gold at the moment.

“Anyone who was expecting miracles from Bernanke is disappointed. Nothing he said will make me change my mind regarding gold,” Morrison said.

He said futures volume has declined lately and money managers have scaled back their long positions since early summer amid some indecisiveness. Money managers stood net long by 182,276 lots for futures and options combined as of Aug. 17, up from 152,713 as of July 20 but down from the high for the year of 230,422 on May 18, according to the Commodity Futures Trading Commission's commitment of traders data.

He pointed out that several markets, such as oil and stocks, are in a trading range.

“Seasonally, people say to own gold from late July to September, but I don’t trade seasonality. I trade what the charts say,” Morrison said.

By Allen Sykora of Kitco News; asykora@kitco.com and Debbie Carlson of Kitco News; dcarlson@kitco.com

Editor’s Note: Meet the Kitco News Team at the upcoming Kitco Metals eConference September 12-13, 2010. A not-to-be missed event featuring Ron Paul, Marc Faber and other industry heavyweights. The eConference is free with Pre- Registration www.kitcoeconf.com.