LONDON, Apr 10 (Reuters): Gold prices were steady on Tuesday but poised for gains as investors awaited potential US action against the suspected use of chemical weapons in Syria as well as more trade friction.
"Geopolitics is taking the main driving seat this week, so gold has potentially got some room for the upside," said Jonathan Butler, commodities analyst at Mitsubishi in London.
"A lot will hinge on what is happening geopolitically between Russia, Syria, Iran and all sorts of other countries that could be potentially drawn into this."
Spot gold was barely changed, down 0.01 per cent at $1,335.73 an ounce at 1005 GMT, having risen to a near one-week high of $1,338.12 earlier in the session.
US gold futures dipped 0.1 per cent to $1,339.10 an ounce.
If gold breaks through resistance of $1,340, it could move back to the late March highs just under $1,360, Butler added.
Trump on Monday promised quick, forceful action in response to a deadly suspected chemical weapons attack in Syria, appearing to suggest a potential military response.
Gold is often seen as an alternative investment during times of political and financial uncertainty.
Gold slipped from its intraday peak on Tuesday after Chinese President Xi Jinping promised to lower import tariffs on certain products, helping soothe fears over an escalating trade row with the United States.
Xi promised to open the country's economy further and lower import tariffs on products including cars. His comments sent US stock futures, the dollar and shares higher.
This dampened the appeal of gold, which is priced in dollars, as investors' appetite for risky assets surged.
