* ECB cancels soft treatment of Greek debt
* Gold in narrow range ahead of Friday's U.S. non-farm payrolls (Updates prices, adds comment)
By Marcy Nicholson and Clara Denina
NEW YORK/LONDON, Feb 5 (Reuters) - Gold fell on Thursday on uncertainty in Greece after the European Central Bank said it would no longer accept Greek bonds in return for funding.
The ECB's announcement dealt a blow to Athens, which is seeking debt relief from eurozone lenders, and knocked the euro down against the dollar in early trading. Gold dipped despite the euro's rebound against the dollar after positive German data.
Spot gold was down 0.5 percent at $1,263.50 an ounce by 2:22 p.m. EST (1922 GMT) after falling 1 percent to the session low at $1,256.22. The market has tested support around $1,255 to $1,256 in four out of five sessions, causing traders to suspect sell-stops are resting below this level.
U.S. gold futures for April delivery settled down 0.1 percent at $1,262.70 an ounce.
"Like in 2014, we had a phenomenal start of the year, up 8 percent in January, so inevitably we are going to see a bit of profit-taking," broker Sharps Pixley Chief Executive Officer Ross Norman said.
Bullion failed to capitalize on a fall in European equities, while it extended losses after an upbeat report on the U.S. labor market lifted stock prices there. Oil prices rose about 6 percent.
"Clearly we think things are improving in the global economy," said Bart Melek, head of global commodity strategy for TD Securities in Toronto.
"You need to have a pretty dire assessment of the future and see the situation in the eurozone deteriorate to attract back those long-term investors who have exited gold in the past two years," Julius Baer analyst Carsten Menke said.
Gold could get short-term support, however, from China's move on Wednesday to cut the reserve requirement for banks in an effort to add more liquidity to fight off an economic slowdown and looming deflation.
While major economies such as China and Europe continue to pump more money into their systems, the United States is moving toward a tightening cycle.
Investors will watch Friday's U.S. non-farm payrolls for more clues on when U.S. interest rates would rise this year, the first hike in nearly a decade. A Reuters poll of analysts had forecast a 230,000 increase in U.S. jobs in January, slowing slightly from 252,000 in December but still robust.
Spot silver fell 0.8 percent to $17.22 an ounce. Platinum rose 1.1 percent to $1,249.90, and palladium gained 0.5 percent to $793.15. (Additional reporting by Manolo Serapio Jr in Singapore; Editing by Mark Potter, David Evans and Lisa Von Ahn)