Gold steadied above three-week lows on Wednesday, supported by new buying interest from the jewellery industry and investors, after tumbling the previous day on a wave of fund selling, dealers said. "The market needs a correction. It can't just carry on going up," said Jeremy East, global head of precious metals at Commerzbank. "I still think we are going to see higher levels at the end of the year or maybe in the next few months, but at the moment we are seeing some profit-taking and stop-loss selling," he added. Gold fell as low as $546.75 an ounce before rising to $548.50/549.40 by 1043 GMT, against $549.80/550.70 late in New York on Tuesday, when the metal dropped more than $20 to record its biggest one-day fall in nearly 13 years. Soft crude oil prices and market sentiment that a correction was due after a prolonged price rally triggered the selling on Tuesday, dealers said. Gold rose to its highest in 25 years at $574.60 last week due to tensions over Iran's nuclear ambitions, worries about the outlook for the dollar and firm energy prices. "I think we will probably see another couple of little tests lower in the next few days, but as a whole the trend is still very firm," said James Moore, analyst at TheBulliondesk.com. Dealers and analysts said the metal had potential to eventually hit $600 in coming months -- a level last seen in December 1980. Physical buying was reported at lower price levels in the Asian market, dealers said. Benchmark gold futures on the Tokyo Commodity Exchange -- currently December -- earlier fell by the daily 60-yen limit to 2,175 yen per gram after fund selling in New York's COMEX prompted liquidation by Japanese investors. A firmer yen, which usually puts downward pressure on yen-denominated commodity prices, also weighed on the Tokyo market. Platinum fell to $1,046/1,050 an ounce from $1,055.50/1,060.50 late in New York and last week's record high of $1,083, while palladium fell to 284/288 from $286.50/290.50. Silver dropped to $9.30/9.33 an ounce from New York's $9.40/9.43. (Additional reporting by Lewa Pardomuan in Singapore)