Gold traded higher with a gain of 135rs as investors anticipated today's launch of the ECB’s second 3year LTRO, making gold to hit a high of 28938. Gold remains more sensitive to moves in the euro/dollar exchange rate in the short term than to rising risk aversion, which in the past has been a positive driver of prices. Gold traders anxiously antcipate Wednesday's launch of the ECB’s second three-year LTRO, after a similar liquidity injection in December averted a credit crunch and eased pressure on euro zone bond markets. Market participants expect the liquidity operation to total nearly EUR500bon, after borrowing EUR489 in the Dec operation. Gold can benefit from such an environment of easy money because of expectations that ample liquidity would put a damper on the value of paper currencies and boost inflation. Gold prices have rallied nearly 13% since the beginning of 2012, boosted by growing expectations for further monetary easing measures from global central banks. Gold may be entering a period of consolidation as market look to get hurdel to clear the Novr 8 high of $1,803 an ounce is leading to light profit-taking. Now technically market is trading in the range as RSI for 18days is currently indicating 64.09, where as 50DMA is at 28157 and gold is trading above the same and getting support at 28711 and below could see a test of 28548 level, And resistance is now likely to be seen at 28988, a move above could see prices testing 29102.

Trading Ideas:

Gold trading range for the day is 28548-29102.

Gold traded higher as investors anticipated Wednesday's launch of the ECB’s second three-year LTRO.

Gold can benefit from such an environment of easy money because of expectations that ample liquidity.

Gains were also helped by comments from Iranian Central Bank Governor Mahmoud Bahmani