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LONDON, Mar 8 (Reuters) Gold fell on Wednesday to its lowest in nearly two weeks on continued selling by funds, but physical buying and bargain-hunting were expected to support the market, dealers said.

Gold has fallen 4 per cent from Friday's three-week highs as a rise in the dollar, weakness in other metals and a drop in oil prices prompted investors to leave the market.

''We will not rule out the possibility of further weakness and prices are likely to remain volatile in a broader range,'' said Yingxi Yu, precious metals Analyst at Barclays Capital.

''The extensive fund length in the market suggests that there is further scope for a decline. Much will depend on the oil market, the general performance across the commodity complex and dollar movements,'' she said.

Spot gold fell as low as $547.25 an ounce and was at $549.25/550.00 by 1106 GMT (1636 IST), compared with $551.90/552.80 in New York late on Tuesday, when it dropped nearly $4. It surged to a 25-year high of $574.60 in early February.

Dealers expected gold to trade in a wide $535 to $560 range in the coming days.

''If we see continued liquidation, we can fall another three or four dollars. I wouldn't be surprised if gold comes down to $545,'' said Jeremy East, global head of precious metals at Commerzbank.

''Indian demand should start picking up again at those levels,'' he added.

Dealers said premiums for gold bars were steady at between zero and 20 U.S. cents an ounce to the spot London price in Singapore, a centre for bullion trading in Southeast Asia.

Spot silver fell to $9.95/9.98 an ounce from $10.08/10.11 late in New York as buying interest, which had pushed up the price to a 22-year high, fizzled out.

Silver traders are closely watching for a ruling from the U.S. Securities and Exchange Commission on a proposed new investment product from Barclays.

Speculation the commission would soon approve a silver-backed security from Barclays Global Investors fuelled last week's rally by silver to $10.31 an ounce.

Dealers said silver would track gold in the coming days.

Gold would closely watch the currency market ahead of a U.S.

Federal Reserve meeting on interest rates later this month as well as crude oil prices.

Oil steadied after a two-day slide as traders weighed the prospects that OPEC would keep pumping full pelt. The dollar fell against the euro after rising over the past two days as Federal Reserve officials signalled the central bank wold keep lifting U.S. short-term rates to prevent inflation from flaring up.

Platinum fell to $1,023/1,027 from $1,036/1,041 an ounce in New York. Palladium fell to $285/290 an ounce from $287/292.

REUTERS SD HS1715