Gold saw choppy late trade in Europe on Thursday, dragged lower by a firm dollar before attracting buying just below $460, dealers said. Spot gold was at $460.30/461.10 a troy ounce by 1602 GMT from $462.70/463.50 last quoted in the US market on Wednesday, when the metal rebounded on short covering after a two-day losing streak.
The precious metal was hit by selling early in the week and at one point on Tuesday was down around five percent from last month's near-18-year high of $480.25.
Opinions were mixed on gold's next move, with some looking for a potential bounce, while others felt it was more prone to falls.
"Gold will fall over the next few weeks towards my $440 an ounce target, but in the short term I wouldn't be surprised if gold gets up to near $470 an ounce in the next couple of days," said John Reade, analyst with UBS Investment Bank.
Simon Weeks, precious metals director at ScotiaMocatta, said prices needed to hold above $455-58 to avoid a test of the 100-day moving average, currently at $446.40.
With gold back to dollar-watching, traders were waiting for the US jobs data on Friday to provide further direction.
The dollar gained against the euro on Thursday after European Central Bank President Jean-Claude Trichet quashed expectations of a near-term interest rate increase in the euro zone.
Trichet said the ECB was prepared to move rates at any time, but he thought current interest rates, which were left unchanged at 2 percent, were appropriate.
Gold generally rises with a drop in the US currency as dollar-priced metal becomes less expensive for holders of other currencies.
Bullion also faced pressure from easing crude oil prices, which eased inflation concerns.
Crude oil prices touched a three-month low below $59 after US data showed crude supplies rose and mild weather crimped demand for winter fuels.
Physical demand showed signs of emerging at current prices, but buyers in India were not active because of the end of the festival season.
The three-month season, with several festivals, ended on Tuesday with Diwali, the festival of lights.
Gold buying normally surges in the period as Hindus consider gold an auspicious metal.
Dealers said Indian jewellers might buy on price dips, but large-scale buying was missing.
Silver rose to $7.53/7.56 an ounce from New York's $7.51/7.54.
Platinum was unchanged at $937/941, while palladium was quoted at $225/229 versus $222/226.
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