Gold futures plunged to a six-week low breaking through key support levels after European leaders failed to convince investors that progress was made in tackling the region's debt crisis at last week's summit, on the domestic ground we have seen support coming on rupee weakness which fallen to the new low of 52.93 that is by -1.29%. Market sentiment was rattled after ratings agency Moody's said that last week's economic summit of European leaders failed to deliver "decisive policy measures" to end the region's debt crisis. The ratings agency warned that the region's debt crisis was still in a "critical" and "volatile" stage, while adding that it will revisit ratings of all euro zone member states in the Q1 of 2012. Also Monday, S&P said Friday's agreement was a significant step in resolving a "crisis of confidence," but warned that time is running out and more action is needed. The comments came after S&P placed the credit ratings of 15 euro zone members, including France and Germany, on watch for a potential downgrade last week. EU leaders agreed to implement stricter budgetary rules across the euro zone and to provide EUR200 billion in loans to the IMF to assist countries with debt problems. Now technically market is trading in the range as RSI for 18days is currently indicating 51.71, where as 50DMA is at 28479 and gold is trading above the same and getting support at 28701 and below could see a test of
28556 level, And resistance is now likely to be seen at 29041, a move above could see prices testing 29236.

Trading Ideas:

Gold trading range is 28556-29236.

Gold falls below $1,700/oz on doubts in eurozone recovery plan, but got support on domectic market on rupee weakness.

The U. S. Federal Reserve will discuss interest rates while France and the U. K. are set to publish inflation data.

SPDR gold trust holdings dropped by 0.60 tonnes to 1294.80 tonnes.