NEW YORK ( TheStreet) -- Gold prices treaded water Wednesday after a heavy selloff but then starting climbing after the Federal Reserve reiterated its committment to pump more money into the system.

Gold for February delivery added 70 cents to $1,333 at the Comex division of the New York Mercantile Exchange. The gold price traded as high as $1,337.70 and as low as $1,324.30 during Wednesday's session. The spot gold price was up $9, according to Kitco's gold index.

The U.S. dollar index was losing 0.18% to $77.78, struggling as the Fed didn't curb its bond buying program. The euro also down 0.11% at $1.36 vs. the dollar.

Gold prices were slightly lower earlier as investors dumped their holdings after another double-digit selloff Tuesday. The SPDR Gold Shares ( GLD) exchange-traded fund dropped more than 30 tons of gold on Tuesday.

>> Video: How to Trade Commodity ETFs

Gold's hovering around the $1,330 level has two results. First, investors see the fall in price, panic and sell. I received a question from a reader Tuesday who bought silver coins and -- spooked by silver's 12.8% selloff so far in 2011 -- was anxious to sell. Or second, traders look at these levels as a time to start buying.

"I am a lot more interested at this level," says Scott Redler, chief strategic officer at T3Live.com. "I personally think the way gold is acting we could have some lower prices in the next few weeks, or the next month or two, down to the 200-day moving average around $1,265." Redler still thinks that a new high for gold this year is possible, but that the feeble rallies and selloffs create short-term trading opportunities.

Jeb Handwerger, editor of GoldStockTrades.com, says "gold has been on sale every six months ... the primary trend is up." Handwerger thinks that the eurozone debt crisis will worsen and that the U.S. dollar will hit new lows as the U.S. government's debts balloon, both of which will push gold to new highs.

"Look for buyers to come back into precious metals and mining stocks now as it reaches long term support and extremely oversold levels," Handwerger says.

The World Gold Council released its Gold Investment Digest early Wednesday which said strong demand from investors was one pivotal factor to higher prices in 2010. The WGC, the sponsor of the SPDR Gold Shares, said investors bought 361 tons of gold through ETFs in 2010, bringing total holdings to 2,167 tons.

This figure trumped jewelry demand for the first nine months of the year which totaled 1,468 tons. Even though that figure marks an 18% year-over-year jump for jewelry demand, it still pales to investment demand.

If you liked this article you might like

Gold, Google, SEC Hack - 5 Things You Must Know Before the Market Opens Thursday

Here's the Hottest New Way to Get Rich With Gold

How to Invest in Unstoppable Gold Prices

Novice Trade: Gold ETF

Will Gold Make You 25,000% Richer Like Bitcoin?