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CHICAGO, Feb. 21 (Xinhua) -- Gold futures on the COMEX division of the New York Mercantile Exchange fell on Tuesday as the U.S. dollar strengthened.
The most active gold contract for March delivery fell 0.2 U.S. dollars, or 0.02 percent, to settle at 1,238.90 dollars per ounce.
After the long holiday weekend, trade volume in gold was up. Gold futures were weighed on as the U.S. Dollar Index, a measure of the greenback against a basket of major currencies, showed extensive strength, increasing by 0.45 percent to 101.35 as of 1845 GMT.
Gold and the dollar typically move in opposite directions, which means if the dollar goes up, gold futures will fall as gold, measured by the dollar, becomes more expensive for investors.
Gold was put under further pressure as the U.S. Dow Jones Industrial Average rose by 112.63 points, or 0.55 percent as of 1845 GMT.
Analysts note that when equities post losses, the precious metal usually goes up, as investors are looking for a safe haven, while the opposite is true when U.S. equities post gains.
Investors are also cautiously weighing the potential for the election of French presidential candidate Marine LePen who on Tuesday widened her lead in the polls.
LePen is generally seen by the markets as a potentially destabilizing factor as she has promised to hold a referendum on French participation in the European Union, which has led some investors to fear a repeat of Brexit.
The precious metal was prevented from falling further as the purchasing managers index flash report released by U.K.-based Markit Economics showed the U.S. PMI falling to a 54.3 level, a figure which analysts note was worse-than-expected and reflected weaker exports and higher costs.
This report gave support to the precious metal as expectations were for stronger results as several manufacturing reports earlier this month showed strength in the U.S. manufacturing sector.
Traders are looking to the remainder of this week for the existing home sales report and the minutes from the Federal Open Market Committee meeting on Wednesday, initial jobless claims on Thursday, and new home sales report on Friday.
Silver for March delivery fell 2.9 cents, or 0.16 percent, to close at 18.001 dollars per ounce. Platinum for April remained unchanged, closing at 1,006.00 dollars per ounce.
