Dealers shifted their attention to the US jobs data for January, due on Friday, and a weekend meeting of the Group of Seven nations, after the Federal Reserve raised interest rates by a quarter-percentage point to 2.5 percent.
Gold bullion has tracked movements of the dollar against other currencies in recent weeks. A sinking dollar had pushed up gold to a 16-1/2-year high of $456.75 in December.
"People are reluctant to do anything. For today, we are going to trade within the same range of $420 to $423," said Ronald Lunge, director of Lee Cheong Gold Dealers in Hong Kong.
But gold could breach $420 an ounce if the euro fell below $1.30, said Lunge who pegged the downside target at $415. The euro was trading around $1.3020 in Asia, slightly weaker than its New York close.
"Gold is trying to break through on the downside, but I think it is probably oversold at the current levels," said one dealer in Singapore, a centre for bullion trading in Southeast Asia.
"Gold will probably range-trade back up towards $425. That's what I am looking for," he said.
In Tokyo, the benchmark December gold futures contract rose three yen per gram at 1,415 yen, tracking gains in New York's Comex market.
The Federal Reserve indicated after on Wednesday's rise that credit would continue to be tightened at a measured pace.
N M Rothschild said in a report that the use of the word "measured" indicated the Fed would continue increasing rates by 25 basis points, with the next increase expected in March.
"The market will now be focused on Friday's US employment data, which is expected to show that 190,000 nonfarm jobs were created in January, up from 157,000 in December," it said.
In other precious metals, platinum was trading at $874/879 an ounce, versus $869/873 in late New York trade. Sister metal palladium was at $186/191 an ounce, versus $185/190.
Silver was at $6.73/6.75 an ounce, versus $6.72/6.75 in New York. Silver has lost more than 17 percent in value since hitting an eight-month high of $8.15 an ounce on December 2.
"2005 promises to be as volatile as 2004. In general, we would expect prices to prove unable to sustain $7.50 an ounce for more than a few weeks," the Commonwealth Bank of Australia said in a monthly report.
"Demand is likely to continue to suffer from the trend towards digital photography," it said. On Hong Kong's Chinese Gold and Silver Exchange, teal gold (37.5 gram ingot) was quoted at HK $3,912 break, versus of HK $3,915.