Gold futures fell early on Tuesday after rising for eight straight sessions on speculative buying, as profit taking dragged it down from a quarter-century high of nearly $545 an ounce, dealers said.
Gold's pull-back pressured other precious metals futures, with silver eroding from Monday's 18-year peak above $9 an ounce, platinum sinking from a prior 26-year high and palladium losing more than 8 percent from its previous 19-month peak.
By 10:09 am EST, February delivery gold was down $8 or 1.5 percent at $523.50 an ounce at the New York Mercantile Exchange's COMEX division, trading from a session high of $533 to $524.60.
Monday's session peak of $544.50 was the strongest price for a benchmark gold futures contract since March 1981.
Traders were ditching some positions as the market turned increasingly cautious, market sources said.
Gold had fallen about 3 percent at one point in overnight trading as Japanese retail investors locked in profits following recent surges.
Analysts said gold's recent rally was fuelled by positive supply/demand fundamentals and ideas that perhaps some of the world's central banks were buying gold, among other mostly economic factors.
Selling on the Tokyo Commodities Exchange pushed all futures contracts limit down overnight after TOCOM announced on Monday it would make an emergency increase on margins due to the recent extreme price jumps, an analyst said.
Chartists peg key support in COMEX gold at $520, $510 and $500, with resistance at $550 and then at $560. The all-time peak for futures, hit in January 1980, was $873.
Spot gold fell to $520.30/521.00 an ounce, from $527.90/528.70 last quoted in New York. The metal briefly touched a high of $526.50 and a low of $520.25.
Tuesday's latest fix in London was at $522.50.
COMEX March silver futures dropped 3.6 percent or 31.7 cents to $8.565 an ounce, trading from $8.95 to $8.555. Spot silver sank to $8.47/50, below its prior New York close at $8.78/81. The London silver fix was at $8.74.
NYMEX January platinum lost $29.10 or 2.9 percent to $989 an ounce. Spot platinum fell to $984/988.
March palladium plummeted more than 8 percent or $24.35 to $268 an ounce. Spot was at $263/267.
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