Gold steadied on Monday after touching its highest level in nearly six weeks with a lower dollar and a dip in equities boosting investor confidence in the yellow metal.
Platinum prices rose to their highest in nearly three months after the main trade union for South African platinum miners said workers at the world's top three producers would go on strike this week.
Spot gold was close to flat at $1,253.19 an ounce at 3:31 p.m. EST (2031 GMT), after hitting its highest level since mid December at $1,259.85 earlier in the day. U.S. gold futures for February delivery were up $2.50 at $1,254.40 an ounce.
European shares edged lower, retreating from 5-1/2-year highs, while the dollar fell 0.2 percent versus a basket of major currencies. Liquidity was thin, with U.S. markets closed on Monday for Martin Luther King Jr. Day.
"Since the start of the year there has been a slight change in attitude towards gold and you can see that with the CFTC (Commodity Futures Trading Commission) positioning or a sharp slowdown in ETF (exchange-traded fund) outflows over the past month," Citi analyst David Wilson said.
"That's because the U.S. Fed tapering has been priced in by now ... but we are not seeing prices gaining much from here in the first half of the year."
Gold, often seen as an alternative investment, has posted four straight weeks of gains, adding about 4 percent to its value.
This followed a 28 percent plunge in 2013, after a 12-year rally, on optimism about a global economic recovery and as the U.S. Federal Reserve announced plans to reduce its monetary stimulus by $10 billion a month to $75 billion from January.
As a gauge of investor sentiment, data from the Commodity Futures Trading Commission showed on Friday that hedge funds and money managers raised their bullish bets on gold and silver futures and options for a third week amid a decline in equities.
"The speculative data last week was quite interesting because both longs and shorts rose, indicating that the market is still very much confused on where to go next," Saxo Bank senior manager Ole Hansen said.
"It is not a sudden shift to one side of the equation, and until we see that, there is going to be quite a significant hurdle to break through current levels."
Holdings in SPDR Gold Trust, the world's largest gold-backed ETF, rose 7.49 tonnes to 797.05 tonnes on Friday, the first increase in a month.
Due to the recent rally in gold prices, Chinese gold demand, which has been robust ahead of the Lunar New Year holiday at the end of the month, has come off slightly as seen in premiums and volumes on the Shanghai Gold Exchange.
Platinum prices rose after South Africa's Association of Mineworkers and Construction Union announced plans to strike on Thursday and said it would send notice to platinum and gold miners on Monday.
Spot platinum rose to its highest level since Oct. 31 at $1,469.50 an ounce, before retreating to trade last at $1461.90 an ounce. Palladium was down 0.2 percent at $745.40 an ounce.
Spot silver was at $20.26 an ounce, close to flat on the day.
(By Clara Denina and Nia Williams; Editing by David Evans, Dale Hudson and Peter Galloway)