Gold prices leveled out on Thursday despite a strengthening U.S. currency making dollar-denominated bullion more expensive for holders of other currencies.
A global stock market selloff has driven investors to the relative safety of the dollar, lifting it from 3-year lows and pushing gold from an 18-month high reached in late January. "The same thing that pushed gold up in January is pushing it down in February - the dollar," Commerzbank analyst Carsten Fritsch said.
Momentum indicators suggested gold would fall to $1,300, said analysts at ScotiaMocatta, with technical support at $1,303, the 50-day moving average. Holdings of gold in exchange-traded funds tracked by Reuters have declined more than 1 percent this month and this week saw the biggest one-day fall since July, helping pull prices lower.