Gold settled up 0.38% at 26925 retained small gains but caution prevailed ahead of a Fed policy statement later in the session as investors waited for clues on the timing of a US rate hike. Bullion was supported after data on Tuesday showed a second straight drop in a gauge of U.S. business investment in September and a decline in consumer confidence this month, hinting at economic weakness. But gains in the metal were limited as the dollar rose. Many investors also chose to stick to the sidelines ahead of a statement by the Fed on Wednesday following a two-day policy meeting. The US central bank is not expected to raise rates on Wednesday, but markets will be eyeing the statement for the Fed's take on the U.S. and global economies, and whether it could hike rates at its next meeting in December. Bullion has been weighed by uncertainty over the timing of a rate hike. In physical markets, China's net gold imports from main conduit Hong Kong jumped to a 10-month high in September, data showed on Tuesday, in a strong sign of recovering demand in the second half of the year. While India regained its top position from China as the biggest overall consumer of gold in the first nine months this year with a total consumption of 642 tonnes, a survey said. In India, jewellery consumption increased by 5% yoy to an estimated 193 tonnes in Q3 2015, the highest quarterly consumption since Q1 2011 and the highest third quarter demand since 2008, the report published by Reuters stated. Technically market is getting support at 26824 and below same could see a test of 26722 level, And resistance is now likely to be seen at 26984, a move above could see prices testing 27042.

Trading Ideas:

Gold trading range for the day is 26722-27042.

Gold retained small gains as investors waited for clues on the timing of a U.S. rate hike.

Traders await the completion of the FOMC's meeting for further indications on the timing of an interest rate hike by the U.S. central bank.

China's net gold imports from main conduit Hong Kong jumped to a 10-month high in September, data showed on Tuesday.