Gold futures in New York fell at the open Wednesday on some investor profit-taking ahead of the long holiday weekend in what was described as a healthy pullback for the market, setting the stage for a possible breach of $500 an ounce next week, sources said.
"It's technically Friday, so this is just some guys getting out of their long positions ahead of the holiday," said one floor dealer.
NYMEX metals will trade an abbreviated session, ending at noon Wednesday. The market will be closed Thursday and Friday in observance of US Thanksgiving Day.
By 10:17 am EST (1517 GMT), benchmark December gold was down $4.60 at $488.30 an ounce on the New York Mercantile Exchange's COMEX division, just off the bottom of its $487.50 to $495.30 trading range. Its all-time high, based on the nearby futures contract, was $873 hit in January 1980.
COMEX gold has climbed 14 percent or $59 this year on robust investor demand due to economic and geopolitical unease and seven straight quarters of increasing global jewellery demand.
COMEX gold volume at 10:00 am was estimated at 50,000 lots, with 6,180 switches.
Floor dealers said the market may have the ability to reach $500 an ounce early next week as over-the-counter options expire on Monday, with all settlements occurring on November 30.
Spot gold slipped to $487.50/8.30 from $494.00/$494.75 an ounce late Tuesday. Wednesday's afternoon fix in London was $487.60. December silver dropped 10.5 cents to $8.065 an ounce, near the lower end of its $8.035 to $8.210 trading band.
Spot silver was last quoted at $8.04/06 an ounce, down slightly from Tuesday's late quote in New York at $8.06/08. The fix on Wednesday was at $8.05.
January platinum was off 3.00 cents at $977 an ounce, as the market continued to back-pedal from last week's near 26-year high of $1,000. Spot platinum last fetched $970/974 an ounce.
December palladium fell $5.25 to $255 an ounce. On Monday, it rose to $270.10 which marked its loftiest level since May 2004. Spot palladium was last at $249/252.