PRECIOUS-Gold ticks up on Iran tensions; firmer dollar limits upside

* SPDR Gold holdings rise 0.7% on Friday
* Speculators raise net gold longs in week to July 16 - CFTC
* Stocks lose momentum as 50bp rate cut possibility fades

(Updates prices)
By Brijesh Patel
July 22 (Reuters) - Gold prices gained on Monday following a
steep fall in the previous session as tensions in the Middle
East and weaker financial markets supported the metal, while a
stronger dollar kept a lid on gains.
Spot gold XAU= was up 0.2% at $1,427.31 per ounce, as of
0735 GMT. The metal hit $1,452.60 in the previous session, its
highest since May 2013, before closing 1.5% lower.
U.S. gold futures GCv1 were up 0.1% at $1,427.80 an ounce.
"Over the weekend, what happened between Iran and the United
Kingdom is supporting gold prices today," said Brian Lan,
managing director at dealer GoldSilver Central in Singapore.
"Also, equities are lower and at this point of time with
geo-political tensions and the Fed looking to cut rates, gold
looks attractive, but people are worried about the stronger
dollar."
Iran's Revolutionary Guards said they had captured a
British-flagged oil tanker in the Gulf after Britain seized an
Iranian vessel earlier this month, ratcheting up tensions along
a vital international oil shipping route.
Britain was weighing its next moves on Sunday, with few good
options apparent as a recording emerged showing that the Iranian
military defied a British warship when it boarded and seized the
ship three days ago. Meanwhile, Asia stocks eased on Monday as investors reduced
expectations of an aggressive interest rate cut by the Federal
Reserve. MKTS/GLOB
Likelihood of a smaller rate cut from the U.S. central bank
lifted the dollar .DXY , making gold expensive for investors
holding other currencies. USD/
The Wall Street Journal reported the Fed was likely to cut
rates by 25 basis points when it meets later this month, and may
make further cuts in the future given global growth and trade
uncertainties. Expectations for a rate cut of half a percentage point at
the Fed's July 30-31 meeting edged out further on Monday to hit
14.5%, according to CME's FedWatch tool, down from as high as
71% last week. FEDWATCH
"Geopolitical risks from the Persian Gulf could provide some
support for the yellow metal, but the next major move will
likely be if the Fed is dovish enough for markets," Edward Moya,
a senior market analyst at OANDA, said in a note.
Holdings of SPDR Gold Trust GLD , the world's largest
gold-backed exchange-traded fund, rose 0.72% to 820.49 tonnes on
Friday from Thursday. GOL/ETF
Hedge funds and money managers raised their bullish stance
in COMEX gold in the week to July 16, the U.S. Commodity Futures
Trading Commission (CFTC) said in a report on Friday.
Among other precious metals, silver XAG= rose 0.9% to
$16.35 per ounce.
Platinum XPT= gained 0.9% to $850.73 an ounce and
palladium XPD= climbed 0.3% to $1,509.24.