Gold dropped marginally on Monday with a fall of -0.38% at 31415 despite of gold in international crawling back towards an 11-month high hit in the previous session, supported by a slightly weaker dollar and investor hopes for further central bank action to battle the grim outlook for global economic growth. The fall in current account deficit has given support to the rupee and rupee settled with a gain of +0.49% at 52.79 as ongoing strong momentum in domestic reforms, liberalisation, fiscal measures and global policy stimulus, creating capital inflows to offset the dollar demand. Spot gold marked an 11-month peak of $1,791.20 on Monday as an unexpected expansion in US factory activity and more clarity on Spain's bailout plan sent some relief through the market, knocking the dollar index from a three-week high. Meanwhile holdings of gold-backed ETF posted a small gain to 73.978mn ounces by Sept. 30, inching towards a record high of 74.28 million ounces hit last week. And trade was thin yesterday as markets in China, Hong Kong and India are closed for public holidays. Now technically market is trading in the range as RSI for 18days is currently indicating 45.2, and getting support at 31292 and below could see a test of 31169 level, And resistance is now likely to be seen at 31577, a move above could see prices testing 31739.

Trading Ideas:

Gold trading range for the day is 31169-31739.

Gold edged lower as uncertainty over whether Spain will request a bailout lingered.

Gold yields to pressure from some investors capturing gains

SPDR gold trust holdings gained by 1.81 tonnes to 1322.59 tonnes.