UPDATE 1-Gold extends losses on rising U.S. dollar

(Updates prices)

SINGAPORE, May 8 (Reuters) - Gold fell further on Thursday
in response to a firmer U.S. dollar, but record-high crude oil
above $123 a barrel was expected to cushion the fall.

Gold <XAU=> dropped to $865.90/866.90 an ounce from
$870.85/872.05 an ounce late in New York on Wednesday but that
was above last week's four-month low at $845 an ounce.

The metal has lost more than 15 percent in value since
spiking to a lifetime high of $1,030.80 on March 17, mainly
driven by profit taking and declines in other commodities.

"Given a lack of market direction, cash gold looks to be
stabilising in a range of between $860 and $880 for now," said
Kaname Gokon, deputy general manager at Okato Shoji Co's
research section.

In contrast, buying from users and investors was boosting
cash platinum as well as the Tokyo futures, Gokon said. "There
are several buy orders for cash platinum lining up at or below
$1,900," he said.

The benchmark contract for April 2009 delivery <0#JPL:> on
the Tokyo Commodity Exchange ended the morning session 20 yen
per gram higher at 6,355 yen, having hit the daily 300 yen
limit up on Wednesday.

Spot platinum <XPT=> dipped to $1,945.50/1,965.50 an ounce
from $1,949.50/1,969.50 late in New York but it had hit an
intraday high of $1,959 an ounce on Thursday.

The euro <EUR=> extended losses to hit a two-month low
against the dollar below $1.5300 as weak euro zone retail sales
data raised concerns about downside risks to the region's
economy.

In theory, a stronger dollar reduces gold's appeal as an
alternative investment to currencies, bonds and stocks.

"There maybe a little bit of physical buying. It's not so
great," said Ronald Leung, director of Lee Cheung Gold Dealers
in Hong Kong.

"There's really no direction at all. It is still in the
$850 to $880 range for a while, waiting to break either side."

Gold futures for June delivery GCM8 on the COMEX division
of the New York Mercantile Exchange fell $3.7 an ounce to
$867.5 an ounce.

Silver <XAG=> edged down to $16.48/16.54 an ounce from
$16.60/16.66 an ounce. Spot palladium <XPD=> fell to
$419.50/427.50 an ounce from $420.50/428.50 an ounce.
Precious metals prices at 0206 GMT
Metal Last Change Pct chg YTD pct chg
Turnover
Spot Gold 867.40 0.25 +0.03 4.17
Spot Silver 16.49 -0.08 -0.48 11.65
Spot Platinum 1945.50 -4.00 -0.21 27.99
Spot Palladium 419.50 1.50 +0.36 13.99
TOCOM Gold 2946.00 -38.00 -1.27 -3.73
22258
TOCOM Platinum 6355.00 20.00 +0.32 19.03
12698
TOCOM Silver 562.50 -13.10 -2.28 3.97
817
TOCOM Palladium 1459.00 -8.00 -0.55 7.99
457
Euro/Dollar 1.5312
Dollar/Yen 104.73
TOCOM prices in yen per gram, except TOCOM silver which is
priced in yen per 10 grams. Spot prices in $ per ounce.
(Additional reporting by Risa Maeda in Tokyo)
(Reporting by Lewa Pardomuan; Editing by Ben Tan)