At 3.35pm, gold was quoted at $391.80/oz, up $3.15/oz from the metal's Friday close of $388.65/oz. The euro was last quoted off its intraday high of $1.2092 at $1.2059, down from the previous close of $1.2065, while the dollar was last quoted at 110.80 yen down from the previous close of 111.12 yen.
The US has increased its security alert on concerns about a possible al-Qaeda attack on a number of prominent financial institutions.
"All the elements appear to be in place for a rally in gold today," London- based UBS analyst John Reade said.
Factors playing into the hands of a gold rally are that fact that speculators have cut their net long positions, by more than expected, and the US has raised its assessment of the risk of a terrorist attack ahead of the US elections, Reade added.
However, for gold to post a decent and sustained rally, the recent dollar strength will have to be reversed and in the near term, there seems to be no sign of that, he added.
Platinum was quoted at $830/oz, up $14/oz from the metal's previous close, while palladium was quoted at $218/oz, up $2/oz from the metal's previous finish.
Platinum continues to benefit from the softer dollar, while palladium is getting support from firmness in the rest of the metals complex.
"It does seem extremely difficult for palladium to absorb all the current selling interest to generate momentum for significant gains," London-based analysts for Barclays Capital said in a note on Monday.