Gold settled up 0.18% at 29184 tracking gain's in Comex Gold which rallied above $1,300 for the first time in over three months, gaining almost 1% after disappointing U.S. retail sales data weighed on the dollar and increased bullion's appeal as a currency hedge. The dollar index tumbled 0.5 percent after U.S. retail sales fell unexpectedly in January and the number of Americans filing new claims for unemployment benefits rose last week, in the latest signs of slowing economic growth. Recent U.S. economic data, including two straight months of weak jobs growth, have raised questions over whether the world's biggest economy can sustain growth and made some investors hope the Fed would take a slower approach to tapering its bond purchases. The soft data fueled worries that U.S. economic recovery still faces headwinds and that the Federal Reserve will take its time dismantling its USD65 billion bond-buying program, while rate hikes remain far off on the horizon. Fed asset purchases weaken the dollar by pushing down interest rates, which tends to bolster assets like stocks and commodities, gold especially due to its role as a hedge to softening paper currencies. Investors have been cautiously moving back into the precious metal as seen in flows into SPDR Gold Trust. Holdings in the ETF rose 1.80 tonnes to 798.85 tonnes on Tuesday. The fund, which lost around 500 tonnes in 2013, has not recorded any outflows in three weeks. Technically market is under fresh buying as market has witnessed gain in open interest by 4.05% to settled at 10511 while prices up 52 rupee, now Gold is getting support at 29092 and below same could see a test of 28999 level, And resistance is now likely to be seen at 29248, a move above could see prices testing 29311.

Trading Ideas:

Gold trading range for the day is 28999-29311.

Gold gained following the release of unexpectedly weak U.S. retail sales figures for January and separate report showing that initial jobless claims rose last week.

The U.S. Commerce Department said that retail sales fell by a seasonally adjusted 0.4% last month, disappointing expectations for a 0.3% increase.

SPDR gold trust holding gained by 7.50 tonnes i.e. 0.94% to 806.35 tonnes from 798.85 tonnes.