Gold traded sideways in a quiet European session on Wednesday, but analysts were disappointed with its recent performance, given security threats which should raise its profile as a safe-haven asset, and renewed dollar weakness.
The metal is near 15-week lows against the euro despite a weaker dollar making gold cheaper for holders of other currencies. Although gold has slightly loosened its link to currency rates, traders still expected moves in the dollar to dictate bullion's short-term trend.
In Europe on Wednesday a slightly higher gold market flirted with the $400.00 an ounce level, and traders expected it to fluctuate around the $400 level ahead of this weekend's Group of Seven meetings.
Gold is some way off January's 15-year high at $430.50, having fallen to its lowest in two months on Monday at $394.30 on speculative selling.
"Gold is going through a bit of a crisis of confidence at the moment," one trader said. "A fair amount of profit has been taken off the table."
By 1558 GMT, spot gold was quoted at $399.30/399.90 a troy ounce, slightly up on New York's close at $398.40/399.15.
The euro was at $1.2516/17, mostly steady on Wednesday after gaining one percent against the dollar on Tuesday.
Traders said volatile price moves in gold and silver earlier this week were making it hard to predict short-term trends, with many dealers preferring to wait on the sidelines.
"Normally a 100 bp (basis point) move in the euro is consistent with a $3 move in the gold market, so the stability in gold prices is somewhat disappointing and reflects ongoing long liquidation by stale bulls," Alan Williamson, metals analyst with HSBC, said in a report.
Speculation has been intensifying that G7 finance ministers were unlikely to agree to halt a slide in the dollar and the market broadly expects them to call for flexible exchange regimes.
Silver steadied to trade flat on the day at $6.10/6.12. The metal has fluctuated wildly since the end of last week, tumbling from a high of $6.63 last Wednesday to a four-week low of $5.93 on Monday - a loss of 10.5 percent.
Analysts said the risk remained to the downside, with the psychological $6.00 level representing support.
"Silver may check out lower levels again before working back up again," UBS Investment Bank's Andy Maag said.
Platinum metals have come under pressure from liquidation by small private investors in Asia in recent sessions, although platinum and palladium have held up relative to gold and silver.
Platinum has three-times tested a one-month low around $814 this week, but the level has held each time. Spot was trading at $823.00/828.00, below New York's $828.00/833.00. Palladium rose to $235.00/240.00 from $230.00/235.00.