However, silver remained under selling pressure for the sixth straight session and shed Rs 30 to Rs 43,470 per kg.
Traders said sentiments dampened after gold fell the most in three weeks in overseas markets on speculation that the Federal Reserve would further curb monetary stimulus as the US economy recovers, reducing demand for the metal as an alternative investment.
Traders said stockists selling against sluggish demand at higher levels mainly led to fall in gold and silver prices.
The precious metals had lost Rs 210 in the previous session.
The exchange also asked traders to square off their trading positions in three contracts -- gold February 2015, kapas March 2015 and kapas April 2015.
Gold prices extended losses for the fourth straight day by losing Rs 325 to Rs 31,100 per ten grams on stockists selling.
Traders said profit-selling by stockists at existing higher levels amid a weak global trend as congressional negotiators reached a US budget agreement, curbing the appeal of the metal as a safe haven, mainly influenced gold prices.
Silver also rose further by Rs 100 to Rs 37,600 per kg.
Bullion dealers said higher overseas market advices have led traders to stock more gold, leading the metal to end Rs 5 higher at Rs 8,725 per ten gram.
Traders said profit-selling by stockists at prevailing higher levels against sluggish demand mainly led to decline in gold prices.
Demand for gold in India, the world's biggest market, has risen sharply with the wedding season in full swing.\n\n\n\n
Silver halted its four-day rising trend and declined by Rs 65 to Rs 41,000 per kg.
Traders said stockists selling against sluggish demand mainly led to decline in gold prices.
Traders said subdued demand from jewellers and retailers at prevailing levels and a weak global trend led to fall in gold and silver prices.
Silver maintained its rising streak for the fourth consecutive day and advanced Rs 100 to Rs 42,400 per kg on sustained buying by industrial units.
Traders attributed the rise in the precious metal prices to emergence of buying at prevailing levels by stockists and retailers to meet the ongoing marriage season demand.
Sentiments remained firm in precious metals on sustained buying by jewellers and retailers to meet ongoing festive season demand.
While gold plunged by Rs 505 to Rs 30,380 per ten grams, silver fell by Rs 280 to Rs 49,300 per kg.
According to Ketan Shroff of Pushpak Bullions Pvt Ltd, "Traders are selling at Rs 14,900 -- 14,950 per 10 gm presently, which was Rs 100-150 lower than the landed cost." He added, "The consumer price depends upon customers' needs as some in dire need of money sell at prices lesser than Rs 14,900 per 10 gm while others attract customers through price negotiations."
Traders said rebound in gold prices was mostly in tandem with a firming global trend on speculation that prices near a two-month low will spur purchases.
Prime Minister's Economic Advisory Council Chairman C Rangarajan dashes bullion firms' duty cut hopes.
Silver also lacked necessary follow-up support from industrial units and coin makers and lost Rs 300 to end at Rs 43,000 per kg.
Globally, gold fell by 0.94 per cent to $1,094.20.
Silver also eased by Rs 320 to Rs 35,780 per kg.
Silver followed suit and recovered Rs 400 to Rs 34,100 per kg.
Amid volatility in equity markets, gold prices may touch a record level of Rs 20,000 per 10 grams in the near future with traders preferring to park their money in safe havens such as the precious metal, analysts said.
India is the largest importer of gold after China.
Gold imports are likely to fall below 50 tonnes this month due to sharp fall in exchange rate of rupee and high global prices of the precious metal, according to market experts.
Traders said sustained buying by stockists and retailers amid a firm global trend where gold advanced as the drop to the lowest level in 34 months last week lured buyers mainly influenced the sentiment.
Traders said scattered buying by retailers amid a firm global trend, where gold climbed to six-month high, and escalating tension in Ukraine mainly boosted demand for the precious metals as a safe haven.
Silver also eased by Rs 200 to Rs 37,200 per kg.
Traders said sentiment turned somewhat weak after gold fell in global markets ahead of US payrolls data that may show employers added more workers last month, boosting the case for an increase in borrowing costs in the largest economy.
Traders said sentiment turned bearish on emergence of stockists selling at existing higher levels amid weak global trend as improving economic growth reduced demand for the precious metals as an alternate investment.
Gold in Singapore, which normally sets price trend on the domestic front, fell from three-month high by declining 0.6 per cent to $1,312.48 an ounce.
Price up on weak dollar and strong demand
Silver coins dropped by Rs 2,000 to Rs 75,000 for buying and Rs 76,000 for selling of 100 pieces.
Traders said sustained buying by stockists helped gold prices to extend gains for the third straight session.
Gold prices fell by Rs 160 to Rs 30,000 per ten grams in New Delhi on sustained selling by stockists against sluggish demand amid a weak global trend.
Traders said reduced offtake by stockists at prevailing higher levels and sluggish demand mainly kept pressure on both gold and silver prices.
Traders said stockists selling in line with a weak global trend as an improving US economy prompted the Federal Reserve to cut stimulus, which reduced demand for precious metals as alternative assets.
