Gold slipped on Wednesday on fund selling and chart weakness, after last week's rally to a near four-month high above $US930 an ounce was met by heavy profit taking.
But investment inflows could also provide strong underlying support, with holdings at the world's largest gold-backed exchange-traded fund at a record high above 800 tonnes.
Gold was trading at $US897.30 an ounce, down $US3.10 from New York's notional close on Tuesday and more than 3% below last week's highs of $US930.40 - within sight of a lifetime high fo $US1030.80 struck last March.
Bullion gained more than 30% since falling to a 13-month low around $US680 in late October, but the rebound also ignited sales of scraps in Asia, which together with fund selling put pressure on prices.
"It looks like gold is consolidating around these levels for a little while and waiting for the non-farm payrolls data on Friday,'' said Ronald Leung, director of Lee Cheong Gold Dealers in Hong Kong.
Some investors ditched gold for shares following gains in the stock markets, said Leung, adding that bullion's failure to hold onto the recent gains also contributed to the current weakness. "There's disappointed selling,'' he said.
