PRECIOUS-Gold drops on profit-taking; set for 3rd weekly rise

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* Gold up 1.2% so far this week

* Speculation grows of aggressive central bank easing

* Silver set for second week of gains

* Gold may fall into $1,483-$1,503/oz range -techs (Recasts, updates prices)

By Harshith Aranya

Aug 16 (Reuters) - Gold slipped on Friday as investorslocked in profits and equities recovered, but fears over aglobal economic slowdown and a lack of clarity on the U.S.-Chinatrade war kept the metal on track for its third consecutiveweekly gain.

Spot gold XAU= was down 0.6% at $1,513.80 per ounce as of0729 GMT, but is up 1.2% so far this week after rising in theprevious two weeks.

U.S. gold futures GCcv1 dipped 0.3% to $1,525.50 an ounce.

Limiting gold's momentum, global financial markets regainedfooting on Friday, as China hinted at more support for itseconomy, amid growing expectations of aggressive stimulus fromall the major central banks. MKTS/GLOBurn:newsml:reuters.com:*:nP8N1YN01S

"Gold is consolidating here. The important consideration isthat none of the headwinds have gone away; the tariffs gotdelayed a bit, but the underlying trade war remains and loweryields are supportive for gold," said Ilya Spivak, seniorcurrency strategist with DailyFx.

"Markets are looking ahead for the Jackson Hole symposium.In context of recent gains that might give us some correctivepullbacks, as people reduce risk exposure before events."

U.S. President Donald Trump said on Thursday he believedChina wanted to make a trade deal and that the dispute would befairly short. urn:newsml:reuters.com:*:nL2N25B1TK

This comes after Beijing vowed to counter the latest tariffson $300 billion of Chinese goods but called on the United Statesto meet it halfway on a potential trade deal. urn:newsml:reuters.com:*:nL4N25B2NR

Earlier this week, 10-year Treasury yields dropped below the2-year yield for the first time in 12 years. Curve inversion iswidely considered a warning that the economy is headed forrecession. US/

Bullion has risen more than $100, since the beginning of themonth amid the heightened trade tensions and a slew ofdisappointing economic data globally.

"The yellow metal continues to benefit from safe-haveninflows, which should ensure that any pullbacks are limitedahead of the weekend," OANDA analyst Jeffrey Halley, said in anote.

Investors will shift their focus to the Federal Reserve'sannual symposium next week. Traders see about a one-in-threechance of a 50 basis-point rate cut by the Fed this September. FEDWATCH

Lower interest rates decrease the opportunity cost ofholding non-yielding bullion and weigh on the dollar.

However, the dollar index .DXY edged higher on Friday andwas on course for a weekly gain. USD/

On the technical side, spot gold may fall into a range of$1,483-$1,503 per ounce, as suggested by its wave pattern and aretracement analysis, said Reuters technical analyst Wang Tao. urn:newsml:reuters.com:*:nL4N25C0T4

Elsewhere, silver XAG= slipped 0.7% at $17.15 per ouncebut was on track for a second consecutive weekly gain.

Platinum XPT= fell 0.3% to $836.36 an ounce, whilepalladium XPD= rose 0.3% to $1,448.52 an ounce.

TECH/C   https://tmsnrt.rs/2N3A2M6
(Reporting by Harshith Aranya and Brijesh Patel in Bengaluru;editing by Richard Pullin and Rashmi Aich) ((harshith.aranya@thomsonreuters.com; Within U.S. +1 646 2238780, Outside U.S. +91 80 6749 6462; Reuters Messaging:harshith.aranya.thomsonreuters.com@reuters.net))

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