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LONDON, Aug 4 (Reuters) Gold inched lower on Friday after trading in a tight $4-an-ounce range below a two-week high, with investors awaiting release of crucial U.S. jobs data and next week's Federal Reserve meeting for direction.

But the market remained vulnerable to choppy trading because of thin business in the current summer holiday period, as many dealers are away from their desks. The Middle East conflict was seen providing some support, dealers said.

Gold hit a high of $647.00 an ounce before dipping to $644.15/645.15 by 0947 GMT, down from $646.50/648.00 late in New York on Thursday and a two-week high of $655.45 on Wednesday.

''Traders await the outcome of today's data and Tuesday's Fed rate decision for a clearer indication of short- to medium-term direction, while the ongoing unrest in the Middle East continues to provide safe-haven support,'' James Moore, analyst at TheBullionDesk.com, said.

The dollar steadied as investors looked to the U.S. data, due at 1230 GMT, for clues on whether the U.S. Federal Reserve will raise interest rates for an 18th straight policy meeting.

The non-farm payrolls report is the last major piece of news before the U.S. central bank decides whether to continue its series of quarter-percentage point rate rises on Aug. 8, which would take the key rate to 5.5 percent.

Higher rates tend to boost the dollar and pressure gold.

''Given the thin summer market conditions, trade is expected to be volatile with unpredictable sharp moves, but the metal should find underlying support from the continuing conflict between Israel and Hezbollah,'' Standard Bank said in a report.

Waves of Israeli air strikes destroyed three highway bridges north of Beirut, forcing U.N. relief agencies to cancel several convoys of aid for the 900,000 people displaced by the conflict.

Gold was unable to rise beyond Wednesday's $655.45 an ounce as selling pressure emerged at higher levels. The metal was also under pressure because of oil prices, which edged down as fears dissipated over a storm in the Gulf of Mexico.

Gold is often seen as a hedge against inflation.

The physical sector saw sales of scrap gold from parts of Asia, and dealers said jewellery makers were waiting for the price to fall back to around $600 an ounce, a level last seen in June, before returning to the market.

Premiums for gold bars were zero to the spot London price in Singapore, while in Hong Kong, gold bars were offered at a discount of up to 20 U.S. cents an ounce.

In other metals, silver climbed to a two-month high of $12.22 an ounce before falling to $12.13/12.23 an ounce, versus $12.04/12.14 in the U.S. market.

Platinum was $1 up at $1,238/1,243 an ounce, while palladium dropped $1 to $321/326 from the New York close.

REUTERS PKS HS1706