Gold eased below $1,190 an ounce in Europe on Monday, extending the previous week's 1.5 percent fall, due to lower investment demand for the precious metal as appetite for other assets improved.
Spot gold was bid at $1,189.55 an ounce at 1112 GMT, against $1,193.10 late in New York on Friday. U.S. gold futures for August delivery rose $2.00 an ounce to $1,190.20.
We are pivoting around $1,200 still, $15 either side, said Saxo Bank analyst Ole Hansen. Some of the risk premium that has gone into gold, primarily from the banking worries we have had, has been all but silenced for now, so that is removing a bit of the support we have had previously.
Liquidity is pretty poor, so it doesn't take much to move this market, he added.
An improved appetite for assets seen as higher risk, like equities and industrial commodities, has taken some of the wind out of gold's sails in recent weeks.
European stocks recovered losses incurred after a Moody's downgrade of Ireland, and turned higher on Monday, while copper prices rose and oil climbed after early losses.
Gold has struggled to hold its ground since hitting a record $1,294.90 an ounce in late June on concerns over euro zone sovereign debt, which boosted interest in the metal as a hedge against currency volatility.
Those fears have retreated, and in an indication of how far they have receded the news that rating agency Moody's had downgraded Ireland's sovereign bond ratings was largely ignored by the gold market.
It is not that the problems in Europe have gone away... but the theme right now is the United States, the weaker data we had from there last week and the subsequent move in the dollar, said Hansen.
The fact that gold is not finding support from the weaker dollar is a bit of a concern.
But as long as holdings of precious metals exchange-traded funds remain firm, gold should remain supported, he added.
Holdings of the world's largest gold exchange-traded fund, New York's SPDR Gold Trust, held at 1,314.211 tons on Friday. They have slipped more than 6 tons in July so far, but are still up more than 180 tons since the start of the year.
The euro firmed in early trade, shrugging off early losses made after the Ireland downgrade, as traders awaited results of bank stress tests.
Platinum was at $1,508.50 an ounce against $1,509, and palladium was at $453.50 against $446.78.
Aquarius Platinum (AQP.L), the world's fourth-largest primary platinum producer, said it will appeal against a directive introduced by the principal inspector of the North West region of South Africa on bord and pillar mining.
In bord and pillar mining, miners extract material from corridors, or bords, leaving material between the bords as pillars holding up the roof.
The directive stipulates all mechanized bord and pillar mines in the region must reduce the width of the bord to six meters from 10 meters. Aquarius said it does not believe the directive will result in fewer accidents.
As the details become clearer and in turn the production implications, this development has the ability to inject a South African premium into the platinum price, said UBS analyst Edel Tully in a note.
Platinum's reaction so far has been limited in Europe. But it's quite possible that the supply uncertainty alone could well feed into a stronger platinum price as the week progresses.
Silver was at $17.76 an ounce versus $17.79.
(Reporting by Jan Harvey; Editing by Sue Thomas)