By Clara Denina
LONDON (Reuters) - Gold steadied on Tuesday as positive technical signals and an easing of the dollar against a a basket of currencies helped the metal to recover from early losses that briefly pulled it below $1,200 an ounce.
Spot gold was up 0.1 percent at $1,207.65 an ounce at 1031 GMT, having dropped by nearly 1 percent to a session low of $1,194.90 as the dollar hovered around 11-year highs, helped by rising Treasury yields.
U.S. gold for April delivery gained $1 to $1,209 an ounce, a 1.2 percent rebound from an earlier low of $1,194.60.
"Stops were triggered overnight in Asia with good volume trading ... prices didn't spend a lot of time under $1,200 ... and seem to be forming a nice technical base in the low $1,190s," Deutsche Boerse's MNI senior analyst Tony Walters said.
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"(But) if the U.S. non-farm payrolls data is a better number, the hawks will see it as a reason for the Federal Reserve to raise rates and gold will get hit."
The dollar index eased from an 11-year peak, mostly on a stronger yen after an economic adviser to Japanese Prime Minister Shinzo Abe said the U.S. currency could not sustain more gains.
Expectations for an increase to U.S. interest rates limited bullion's gains, keeping it below Monday's two-week high of $1,223.20. Gold fell 5.5 percent in February, its biggest monthly loss in five months, with the strengthening economy increasing the likelihood that the Federal Reserve will raise rates this year for the first time since 2006.
"Despite most people swaying back and forth on the timing of the U.S. rate hike, there is still consensus that it will happen this year," said Mark To, head of research at Hong Kong's Wing Fung Financial Group.
Seven of the Fed's 17 members have said they at least want the option of an rate rise in June on the table, or have pushed in general for an earlier increase in expectation that wages and inflation will turn higher.
Structural reforms in China, aimed at a more sustainable pace of economic growth, would also keep gold demand in check, To said.
Most analysts expect China's gold imports via main conduit Hong Kong to recover this year but to stay below the record 1,158.16 tonnes imported in 2013.
Spot silver was up 0.1 percent at $16.38 an ounce, while palladium dropped 0.6 percent to $822.05 an ounce and platinum edged 0.1 percent higher to $1,185.80 an ounce.
(Additional reporting by Manolo Serapio Jr in Singapore; Editing by David Goodman)
