Gold yesterday jumped and settled with a jump of +0.58% at 29448 as support seen from the rupee weakness which fell the most in a month as risk assets got pummelled, sending the euro sharply lower against multiple currencies, although the local unit found support from large dollar sales by a petrochemical company. Also Fears Spain will have to seek a full sovereign bailout, coupled with mounting worries that Greece may leave the euro, sent the euro sliding to a two-year low against the dollar and a near 12-year trough against the yen on Monday. Spain's heavily indebted eastern region of Valencia said on Friday it would need financial help from Madrid, spooking financial markets and complicating central government efforts to stave off a full-blown sovereign bailout. Meanwhile ECB turned up the heat on Greece on Friday ahead of a review of its bailout programme, saying it would stop accepting Greek bonds and other collateral used by Greek banks to tap ECB funding, at least until after the review. Also news is there that Russia's central bank raised its gold holdings by around6.2tns, in June, taking its total holdings to 29.5 million ounces. Now technically market is getting support at 29336 and below could see a test of 29225 level, And resistance is now likely to be seen at 29520, a move abovecould see prices testing 29593.
Trading Ideas:
Gold trading range for the day is 29225-29593.
Gold ended with gains on rupee weakness as prices as it outperformed equities and other commodities.
Fears the Spanish debt crisis is getting worse pushed the yellow metal down as well.
Holdings in the SPDR Gold Trust fell 15.1 metric tons last week, the largest drop since Dec. 23.
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