PRECIOUS-Gold slips but on track to end four-month losing streak

July 31 (Reuters) - Gold fell on Friday but was on track for its first monthly gain in five months, supported by bargain buying around the $4,000 level, while investors weighed developments in the Middle East and their impact on U.S. rate outlook.

Spot gold XAU= fell 0.6% to $4,076.53 per ounce, as of 0253 GMT, but was headed for a weekly rise of 0.6%. Prices were up about 1.7% this month.

U.S. gold futures GCcv1 for August delivery lost 0.4% to $4,074.20.

"Gold is showing a mild negative bias today amid profit-taking and a moderate bounce in the U.S. dollar, following the metal's gains yesterday and the corresponding fall in the greenback," said Tim Waterer, chief market analyst at KCM Trade.

The dollar gained about 0.3%, after diving 2.4% in its biggest single-day drop since January 2023 on Thursday. A stronger U.S. currency makes dollar-denominated commodities more expensive for overseas buyers. USD/

However, "gold has had a better run of things this month. A key support has been the metal finding a cushion of sorts around the $4,000 level, which has attracted buyers on dips," Waterer said.