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PRECIOUS-Gold prices fall after Monday's surge

* U.S stock markets stabilise, dollar strengthens

* Gold down 0.5 pct after rising 1.3 pct on Monday

* Struggles to break from trading range

* Funds raise bets on higher prices

(Updates prices, recasts) LONDON, April 3 (Reuters) - Gold prices fell on Tuesday as U.S. stock markets stabilised, easing fears of a deeper sell-off, and the dollar strengthened, making bullion more expensive for users of other currencies. Gold had surged on Monday as falling U.S. share prices and fears of a global trade war pushed investors towards safer assets. But while European stock markets continued to fall, led by technology shares, Wall Street opened broadly higher.

Spot gold was down 0.5 percent at $1,333.80 an ounce

at 1509 GMT after rising 1.3 percent on Monday. U.S. gold

futures were 0.7 percent lower at $1,337.80 an ounce.

"It's a correction after yesterday's strong move," said Commerzbank analyst Carsten Fritsch. "There's a lack of conviction that prices will rise much further or can sustain levels of $1,350. Profit taking started here so we are back below $1,340." Gold has struggled to break from a trading range of $1,310- $1,360 since the start of the year. "It's going to take a significant trigger to push it beyond this range," said Danske Bank analyst Jens Pedersen. One potential trigger is a trade dispute between the world's two largest economies, with the Trump administration expected this week to unveil a list of advanced technology Chinese imports targeted for U.S. tariffs after Beijing on Monday raised tariffs on 128 U.S. products. Gold is often used as a safe place to park assets during times of financial or political uncertainty. Funds have raised their bets on higher prices, with the net long position on the Comex exchange rebounding from a three-month low. Speculative investors have room to expand their long positions further, which would help drive prices higher, analysts at Citi said in a note. Higher market volatility and rising tension between Washington and Beijing will likely hold gold above $1,300 throughout 2018, they said. "We assign a 30 percent probability that gold prices can scale $1,400 an ounce this year." Momentum indicators suggested gold prices would rise, with technical Fibonacci support at $1,317.25 and resistance at $1,361.80, analysts at ScotiaMocatta said in a note.

In other precious metals, spot silver was down 1.2

percent at $16.41 an ounce after rising 1.8 percent in the previous session.

Platinum was 1.1 percent lower at $919.70 an ounce. Palladium was down 0.3 percent at $932 after touching

$927.75, its lowest since Oct. 10.

(Additional reporting by Swati Verma in Bengaluru, editing by David Evans and Alexandra Hudson)