Gold rebounded on Monday after an early drop spurred buying from jewellers in Asia, but further gains could be limited by a rally in the US dollar amid persistent euro zone debt concerns.
Investors also closely watched an escalating tension in the Korean peninsula, although dealers said there were no signs of buying related to the crisis sparked by North Korea's artillery attack on a southern South Korean island.
Spot gold added $1.46 to $1,363.19 an ounce by 0327 GMT, having hit an intraday low at around $1,353 -- not far from a low around $1,350 seen last week. Bullion was below a lifetime high around $1,424 struck in early November.
According to a Reuters market analyst, Wang Tao, spot gold may extend its fall towards $1,329.45 per ounce as a big downward wave "C" is progressing.
"For today, I would look at support for gold at about $1,350. However, I think if we see a breach of this level, then we could see gold retreating further," said Ong Yi Ling, investment analyst at Phillip Futures in Singapore.
"For the week ahead, I will also expect gold prices to pass some of its gains that was accumulated earlier. Currently the gold and the dollar is having a pretty strong inverse relationship."
U.S. gold futures rose $1.1 an ounce to $1,363.5 an ounce.
The euro slipped to its lowest in two months against the dollar as the market looked past a rescue package for Ireland to other euro zone economies and a euro zone crisis resolution mechanism.
EU finance ministers endorsed an 85 billion-euro loan package to help Dublin cover bad bank debts and bridge a huge budget deficit, and approved outlines of a permanent crisis-resolution system which could make private bond holders share the burden of restructuring sovereign debt bought after 2013.
"The dollar is so strong, but we see buying on the physical side when trading started in Asia. That helps the market a bit. Some Chinese guys may be buying a bit," said dealer in Hong Kong.
"I would think $1,350 is a good support for gold, but I don't think we will go down too much even if we break that level."
Silver also bounced on firmer gold, platinum was flat, while palladium barely moved.
The world's largest silver-backed exchange-traded fund, iShares Silver Trust, said its holdings slipped to 10,711.23 tonnes by November 26 from an all-time high of 10,893.68 tonnes by Nov 23.
In other markets, the Nikkei edged higher as the yen softened against the dollar, oil rose past $84 and the dollar gained on fears of a financial market contagion engulfing other euro zone economies.
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