Investing.com - Gold futures held near a three-month struck in the previous session on Tuesday, as a broadly stronger U.S. dollar dampened the appeal of the precious metal.
On the Comex division of the New York Mercantile Exchange, gold for December delivery inched up 0.05%, or 60 cents, to trade at $1,254.90 a troy ounce during U.S. morning hours.
Prices held in a narrow range between $1,252.90 and $1,258.90 an ounce. A day earlier, gold futures fell to $1,252.10, a level not seen since June 10, before settling at $1,254.30, down $13.00, or 1.03%.
Futures were likely to find support at $1,250.10, the low from June 10 and resistance at $1,272.60, the high from September 8.
Also on the Comex, silver for December delivery slipped 0.02%, or 0.3 cents, to trade at $18.95 a troy ounce. Silver futures hit $18.93 on Monday, the lowest since June 6.
The dollar rose to its highest level in six years against the yen, while the euro slid to fresh 14-month lows after a study by the San Francisco Federal Reserve published on Monday indicated that Fed officials see rates rising earlier than markets expect.
Gold costs money to store and struggles to compete yield-bearing assets when interest rates are on the rise.
The greenback has rallied in recent weeks amid expectations that the Fed may announce a rate increase earlier than expected after economic data indicated that the recovery in the U.S. is progressing strongly.
A stronger U.S. dollar usually weighs on gold, as it dampens the metal's appeal as an alternative asset and makes dollar-priced commodities more expensive for holders of other currencies.
In the week ahead, investors will be awaiting Friday’s U.S. data on retail sales and consumer sentiment for further indications on the strength of the economic recovery and the possible future path of monetary policy.
Elsewhere in metals trading, copper for December delivery plunged 2%, or 6.4 cents, to trade at $3.105 a pound as concerns over the health of China's economy dampened demand for the industrial metal.
China is the world's largest copper consumer, accounting for nearly 40% of global demand.