Gold was little changed on Tuesday, taking a breather a day after paring a 3 percent gain made last week on a rebound in the dollar, while declines in global stock markets underpinned its allure as a safe-haven asset.
Tokyo's Nikkei share average .N225 fell 1.4 percent after hitting a six-month closing high the previous day, while the dollar edged down against a basket of currencies toward Monday's four-month low but held firm versus the euro. .T
If another sell-off hits U.S. stocks later in the day and boosts the dollar's appeal to investors, as it did on Monday, gold could test $900 because of its failure to rise decisively above $920 in the past weeks, analysts said.
"The market doesn't have enough confidence to break this resistance" at the $918-$920 level that has been capping gold since late April, said Louis Lok, a dealer at Bank of China in Hong Kong.
"Now gold could go under $900," he said.
Spot gold was at $913.90 an ounce at 11:23 p.m. EST, up 0.1 percent from New York's notional close of $912.60.
On Monday it fell about 0.4 percent as the dollar rebounded from a four-month low against a basket of currencies .DXY, making dollar-priced bullion pricier for non-U.S. investors.
"The market has lost appetite for safe-haven buying of gold recently because of the fact that the investment market situation has stabilized ... The (negative) correlation with the U.S. dollar has been stronger than before," said Bank of China's Lok.
U.S. gold futures for June delivery edged up 0.1 percent to $914.2 per ounce after settling down $1.40 on Monday on the COMEX division of the New York Mercantile Exchange.
The world's largest gold-backed exchange-traded fund, the SPDR Gold Trust, said holdings stood at 1,104.09 metric tons as of May 11, unchanged from the previous business day.
Traders were cautious as the Tokyo Commodity Exchange, Japan's biggest commodity futures exchange, suspended trading of all contracts as of 11:35 a.m. (10:35 p.m. EST) due to system problems.
It was the first glitch since the exchange launched a new trading platform on May 7, extending trading hours in an attempt to lure back investors amid the market's shrinking liquidity.
The exchange is investigating the cause and it is not known when trading would resume, a TOCOM spokesman said.
