Tokyo gold futures fell to near a one-week low on Wednesday as fund operators unwound long positions built up over the past week in reaction to falls in the dollar-denominated spot price. The market was bullish but in a corrective mode ahead of the end of the Federal Reserve's policy-setting meeting on Thursday and a long weekend in the United States, traders said.
The technical trend weakened slightly after the key distant gold contract on the Tokyo Commodity Exchange dropped below its 7-day moving average of 1,541 yen per gram, which prompted profit-taking, they said.
June TOCOM gold closed down 11 yen, or 0.71 percent, at 1,540 yen after moving between 1,538 yen the lowest since June 23 and 1,543 yen.
Other contacts closed down 9 to 13 yen. "People appear to be nervous about chasing gold above 1,550 yen, but the market is still in an upturned," said Shoji Sugata, assistant manager Mitsubishi Corporation Futures Ltd.
Spot gold was trading at $434.15/$434.90 an ounce compared with $435.80/$436.50 in New York. It hit a three-month high of $443.60 on Friday.
The market was largely pricing in a quarter percentage point rate hike at the FOMC meeting. Attention has turned to any hint in the post-meeting statement of a pause in further rises.
The dollar was at 110.10/12 yen in late Asian trading after rising to 110.17, its highest level since mid-October. TOCOM platinum futures also eased.
Traders said the market was careful about taking more long positions as the key June platinum contract ran out of steam after hitting a 14-month high of 3,064 yen on Monday.
The TOCOM platinum contract closed down 16 yen, or 0.53 percent, at 3,023 yen. It had moved in a range of 3,016 to 3,034. Other contracts closed down 11 to 22 yen.
Below are closing prices for TOCOM's most active precious metals contracts, with the day's turnover for each metal.
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