"The French are making fairly good progress with the arrests, with the raids. I think the market is turning its attention to the fundamentals of the market," said Rob Haworth, senior investment strategist for U.S. Bank Wealth management in Seattle.
"We're seeing increased risk but the fundamentals that are driving the Fed really are bigger factors and don't seem dissuaded."
In the first 10 minutes of trading Monday, nearly 3,000 lots changed hands, almost 10 times the 300-lot average for the opening 10 minutes over the past two months, Reuters' calculations showed.
"Gold opened higher early this morning on the back of what happened over the weekend on perceived geopolitical risk, but it seems to be already short-lived because the bigger macroeconomic issues are the dollar's strength and the (expected) U.S. rate hike," Citi strategist David Wilson said.
The dollar rose against major currencies and U.S. and European equity markets gained modestly, as markets grew more convinced the Fed will raise interest rates next month and investor worries faded over Friday night's attacks in Paris.
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Before Monday's gains, gold had fallen for 12 sessions out of 13 on increasing bets that the Fed would raise U.S. interest rates next month, which would increase the opportunity cost of holding the non-yielding asset.
Gold is typically seen as a safe investment during times of uncertainty. However, there has not been an increase in demand from retail investors since the Paris attacks, German coin dealer Degussa said in an emailed statement.
"(Buying was) already relatively high throughout last week, but the reason for that was clearly the most recent price drop," the statement said.
Tracking gold, the platinum group metals gained. Platinum was up 1.1 percent at $883.75, after falling to $851, the lowest since December 2008. Palladium climbed 1.7 percent to $545, rising for the first time in six sessions.
Silver was flat at $14.24 an ounce.