Gold prices held within a narrow range on Monday as markets awaited further clues on the timing of an interest hike by the US Federal Reserve.
Spot gold was down 0.9 per cent at $1,265.68 an ounce at 0745 GMT, while US gold futures fell 0.1 per cent to $1,266.40.
"Given the risk is just going to be increased, most people are going to liquidate a part of their holdings, just to place themselves in a safer position," said Mark To, head of research at Hong Kong's Wing Fung Financial Group.
"Ahead of the US elections results, it will move around the level $1,250 to $1,270 without much momentum to go up," he added.
Third-quarter growth figures from the United States and Fed policymakers speeches due this week will be closely watched by the market for clues on a possible interest rate hike.
Hedge funds and money managers cut their net long positions in COMEX gold for a third straight week in the week to October 18, US Commodity Futures Trading Commission data showed on Friday.
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San Francisco Fed President John Williams on Friday redoubled his call for raising rates soon, telling reporters after a speech here that "this year would be good" for a rate rise that he had wanted to take effect last month.
Gold is highly sensitive to rising US interest rates, which increase the opportunity cost of holding non-yielding assets such as bullion, while boosting the dollar, in which it is priced.
"People are watching the US elections and the data is on the positive side, favourable for a rate hike. As long as prices stay below the $1,300 mark, the downward trend might continue," said Hareesh V, research head of Geofin Comtrade Ltd.
"Prices need to break convincingly above the $1,300 level for a strong upside movement."
Spot gold is biased to retest a support at $1,261 per ounce, a break below which could cause a loss to $1,251, according to Reuters technical analyst Wang Tao.
Silver was up 0.1 per cent at $17.63 an ounce.
Platinum was up nearly 1 per cent at $938.00 an ounce. In the previous session, it touched a low of $921.20, its lowest level since February 29.
Palladium, which touched a more-than-three-month low of $613.10 in the previous session, rose 0.16 per cent at $629.00.