While gold is traditionally considered an inflation hedge, a stronger dollar makes gold more expensive for holders of other currencies.
"There are some hiccups related to supply chain and energy markets, but this is not something that will derail the global economy. Hence, there are no real reasons for investors to seek gold as a safe haven," said Julius Baer analyst Carsten Menke.
However, given the "record high" number of open job positions in the United States, a "positive surprise on the non-farm payrolls should be adjustable for the gold market without causing a major sell-off", Menke said, adding prices are likely to be volatile.
A strong showing of private jobs in September ahead of Friday's employment numbers encouraged bets that the Fed could start tapering soon.
Gold market participants seem to be currently "buying on the dips", Commerzbank commodities analyst Carsten Fritsch said.
Reduced stimulus and higher interest rates lift bond yields, translating into increased opportunity costs of holding non-yielding bullion.
"We'll need to see gold prices break above major resistance levels before we have a better idea if gold is about to end its short-term bearish trend," said Vincent Tie, sales manager at Singapore dealer Silver Bullion.
Elsewhere, spot silver rose 0.8 per cent to $22.76 per ounce, platinum was up 0.1 per cent at $985.10 and palladium climbed 1.1 per cent to $1,910.94.