Gold rallied as China moved to spur more investment in the metal at a time when investors are clamoring for it as a refuge. Prices jumped as China approved a fund that will invest in gold exchange-traded funds outside the country, opening the door to mainland China investors who face negative real interest rates on their bank deposits and want to hedge against inflation. Gold opened the day at 20600 and made a low of 20588. It has been an up day for the metal with Euro Gold reaching new record highs. Investors buying safe haven assets on speculation that the Euro banking crisis will spread to Spain and Portugal, took gold to its high of 20874 late in the session. Gold closed the day at 20807. Now support for the gold MCX is seen at 20639 and below could see a test of 20470. Resistance is now likely to be seen at 20925, a move above could see prices testing 21042.

Trading Ideas:

Gold trading range is 20470-21042.

Gold rallied as China moved to spur more investment in the metal

Gold looks to take support at 20712 and resistance at 20925.

In spot gold looks to take support at 1372$ and resistance at 1400$