SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, said its holdings rose 5.69 tonnes to 796.39 tonnes on Tuesday.
The fund is a proxy for market sentiment due to its size, and flows in and out of the fund tend to impact prices.
"Two days of big flows into the fund is supporting prices," said one Hong Kong-based trader. "This is a good sign as physical demand in Asia is weak because of the rise in prices."
"From here, an upside looks more likely given persistent tensions in Iraq and Ukraine."
Spot gold was little changed at $1,325.20 an ounce by 0306 GMT, just shy of the three-month top of $1,332.10 hit in the previous session. Physical demand across top buyer Asia has been lacklustre due to high prices.
Investors are waiting for a key US jobs report on Thursday for indications on the strength of the economy, which will then give direction to prices of the safe-haven metal that continues to be underpinned by geopolitical tensions in Iraq and Ukraine.
Ukrainian forces struck at pro-Russian separatist bases in eastern regions with air and artillery strikes on Tuesday after President Petro Poroshenko announced he would not renew a ceasefire but go on the offensive to rid Ukraine of "parasites".
In Iraq, Sunnis and Kurds walked out of the first session of the country's new parliament on Tuesday after Shi'ites failed to name a prime minister to replace Nuri al-Maliki, dimming any prospect of an early national unity government to save Iraq from collapse.
Among other precious metals, platinum dipped slightly to $1,497.24 after gaining 1.5 percent on Tuesday, when it hit a near 10-month high of $1,511.00.
Last week, the world's biggest platinum producers reached a wage settlement with miners in South Africa after a five-month long strike. But fears of further labour unrest and possible restructuring at mines continued to support prices of the metal.
Platinum, a key component of autocatalysts, was also supported as US June auto sales posted the best annualized figures in eight years, hitting levels not seen since before the financial crisis that led to the bankruptcy of two American automakers.