By Myra P. Saefong, MarketWatch TOKYO (MarketWatch) -- Gold futures edged lower in electronic trading Wednesday in Asia, retreating from a record close in New York as traders took in profits from a one-day gain of nearly $31 an ounce. Gold for December delivery was trading $2.40 lower at $1,082.50 an ounce on Globex by the late morning in Tokyo. The contract had closed $30.90 higher, or a gain of 2.9%, at $1,084.90 in New York -- a record closing level for the contract. The front-month, but thinly-traded, November contract was down $2.10 at $1,082.20 on Globex, after closing at a record $1,084.30 in New York. The International Monetary Fund said Monday it sold 200 metric tons of gold to the Reserve Bank of India, part of a total of 403.3 metric tons of gold approved for sale in September. The news of India's purchase underpinned gold's advance on Tuesday. See Tuesday's Metals Stocks. "Central banks portray a long-term picture of things to come," said Chintan Karnani, an analyst at Insignia Consultants in New Delhi. "If central banks are buying gold, why should retail investors be left behind?" The rise in gold prices was also partly due to the "massive short covering and option-related buying," he said, characterizing the Tuesday rally in gold and other commodities as "too much money chasing too few goods." At the same time, scrap gold sales have ended, and Karnani expects to see greater jewelry demand at prices below the $1,050 level. On a technical level, $1,125.40 is key resistance, he said. That level needs to be breached for gold to see further gains. And if gold's rally continues into next week, he predicts gold prices could reach $1,200 this month.

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