(Adds comment and updates prices) * Bank of Japan eases monetary policy * Spot gold may test support at $1,703 - analyst * For an interactive graphic tracking the global spread, open tmsnrt.rs/3aIRuz7 in an external browser By Asha Sistla April 27 (Reuters) - Gold prices fell on Monday as equities gained on improved risk appetite boosted by fresh stimulus from the Japanese central bank and countries planned easing of coronavirus-led lockdowns, but continued worries over a global recession capped losses. Spot gold fell 0.5% to $1,718.68 per ounce by 0816 GMT. U.S. gold futures rose 0.2% to $1,738.20. "Upside in equity and base metals, and technical resistance are pressuring gold (triggering lower-side risk in gold prices)," said Vandana Bharti, assistant vice-president of commodity research at SMC Comtrade. "Whenever we get stimulus measures and markets don't react, then we see buying in gold. But this time, we're seeing a positive reaction in equity markets." Asian shares bounced back on fresh stimulus from Japan's central bank, with Chinese shares climbing higher on a drop in new coronavirus cases in the country. The Bank of Japan ramped up risky asset purchases and pledged to buy unlimited amounts of government bonds to combat the economic fallout from the coronavirus epidemic. "The peak(ing) (of the) virus will be the theme of the week. Should be positive for equities but will sap the upside momentum for gold for now," said Jeffrey Halley, senior market analyst at OANDA. "... Only the U.S. Federal Reserve really matters, and if the world thinks we've reached peak virus and countries are partially reopening, any extra stimulus will get drowned in COVID-19 noise." Gold tends to benefit from widespread stimulus measures as it is often seen as a hedge against inflation and currency debasement. Various nations, including the United States, are on track to ease certain restrictions and allow businesses to reopen, raising investors' hopes of higher number of testing kits and more drug trials. Holdings of the world's largest gold-backed exchange-traded fund, SPDR Gold Trust , rose 0.6% to 1,048.31 tonnes on Friday. Spot gold may test a support at $1,703 per ounce, a break below could cause a fall to $1,677, according to Reuters technical analyst Wang Tao. Palladium gained 1% to $2,045.38 per ounce, while platinum rose 0.2% to $761.50 and silver shed 0.3% to $15.19.