Gold fell last week after China raised bank reserve requirements and investors took profits in bullion U.S. data showing rising consumer confidence and a shrinking trade gap. Physical buying from India and other centers this week was likely one of the reasons more investor longs didn't liquidate, as strong physical demand is often a sign that a downtrend is about to bottom. Gold is closing as a down week at current 20491. This week the metal achieved a fresh record high at 20924 before reversing. A lower close next week, or a break of last weeks 20250 low, will trigger liquidation of long positions. The daily chart is currently in bear mode after a key reversal confirmation Wednesday. Now support for the gold MCX is seen at 20358 and below could see a test of 20225. Resistance is now likely to be seen at 20637, a move above could see prices testing 20783.

Trading Ideas:

Gold trading range is 20225-20783.

Gold fell due to profit booking after China raised bank reserve requirements

Gold looks to take support at 20420 and resistance at 20580.

Spdr gold trust holdings fell by 3.95 tonnes to 1289.83 tonnes.