Continued liquidation in gold-backed exchange-traded funds amid signs of an improving U.S. economy may undermine gold's recent safe-haven gains which helped bullion to three-week highs above $1,300 an ounce, CNBC's weekly sentiment survey showed.
Still, gold bulls maintained that the markets were underestimating the risks of a worsening crisis in Ukraine.
"I'm slightly bullish as I believe Ukraine is unpredictable," said Edmund Moy, Chief Strategist at Morgan Gold and a former director of the U.S. Mint. He added that investors also fear a May correction in U.S. stock markets.
Skeptics, though, argue that gold's relative lack of conviction despite the Ukraine crisis has called into question its safe-haven status.
"Gold is performing terribly as the 'safe' play, even when stocks fall," said Yoni Jacobs, chief investment strategist at Chart Prophet Capital, an equity investment fund. "Add to that continued Fed tapering, and there is downside pressure."
Some 60 percent of market professionals polled in CNBC's weekly survey (21 out of 35) expect the price of gold to fall this week.
"The impact of stronger U.S. economic data in Q2 2014 via investment outflows in gold could be stronger and exert additional downward pressure on prices, thereby offsetting price supportive news flow from geopolitical concerns," said UBS strategists Dominic Schnider and Giovanni Staunovo in emailed comments to CNBC.
"We therefore want to reiterate our long term negative price stance with a forecast at 12-month forecast at $1,050/oz. We continue to recommend reducing allocations to levels that make sense from a long-term portfolio standpoint."
SPDR Gold Trust, the world's largest gold-backed exchange-traded fund, said its holdings fell 2.70 tonnes to 782.85 tonnes on Friday - its third straight session of losses, Reuters reported. Last week alone, the fund saw nearly 10 tonnes in outflows.
It comes as data on Friday showed U.S. employers hired workers at the fastest clip in more than two years in April, pointing to a rebound in economic growth after a severe winter. The data initially pressed the metal to a one-week low of $1,276.60, but it reversed the losses to end the day up 1.3 percent on a sharp increase in the number of people dropping out of the workforce and rising Ukraine tensions, Reuters reported.
And despite the bearish tilt of CNBC's survey, a fifth of those polled (7 out of 35) are betting gold will extend its gain. Meanwhile, latest data from IG Markets shows 80 percent of their more than 500 clients with open positions also expect gold prices to advance. Seven respondents in the CNBC poll said they believed gold would trade around current levels.
"We are quickly learning that every economic headline has a postscript and every data release has granular detail that belies a much weaker economy than advertised which is why gold has remained so resilient," said Scott Carter, CEO of Los Angeles-based Lear Capital.