SINGAPORE (Reuters) - Gold edged down in choppy trade on Monday, after posting its biggest gains in eight weeks in the previous session on the political unrest in Egypt, but buying interest in the physical market offered support and offset worries about declines in ETF holdings. Silver was at a 1-week high, tracking gold's earlier gains. The world's largest gold-backed exchange-traded fund, SPDR Gold Trust, said its holdings slipped to 1,224.118 tonnes by January 28, its lowest since May of last year. Spot gold fell $1.05 to $1,337.25 an ounce by 07:24 a.m. British time, having earlier risen to around $1,345. Gold dropped to as low as $1,308 on Friday, its weakest since early October 2010, before reversing losses on safe haven buying related to the chaos in Egypt. "We need to see the holdings in ETF start to increase before gold prices can head up and make a new high. Bullion holdings at ETFs are a reflection of longer-term demand for gold," said Ong Yi Ling, investment analyst at Phillip Futures in Singapore. "Recently, the holdings of gold ETFs have decreased due to optimism in the U.S. economic recovery. If concerns over jobs and unemployment come back to haunt us, then we could see the ETF holding start to increase again U.S. gold futures for February fell $3.4 an ounce to $1,337.30 an ounce, having ended up nearly 2 percent on Friday. Brent oil futures climbed near $100 a barrel and Asian stocks fell on Monday, hurt by fears that the deadly protests in Egypt may foment unrest throughout the Middle East and choke oil supplies, accelerating a move out of riskier assets. Egyptian protesters were camped out in central Cairo on Monday and vowed to stay until they had toppled President Hosni Mubarak, whose fate appeared to hang on the military as pressure mounted from the street and abroad. In the physical sector, premiums for gold bars were at their strongest level since at least 2004 on tight supply, short covering before the festive season in India and China as well as physical buying driven by the deadly protests in Egypt. Spot gold is expected to temporarily end the rebound around $1,348 and retrace to $1,320 as the sharp surge on Friday is regarded as part of a wave (4) correction, according to Wang Tao, a Reuters market analyst for commodities and energy technicals. "I think the problem in Egypt could be resolved soon. If the U.S. is doing something, it will be solved. You can't have so much violence in so many days. But I think people will still want to buy gold on dips," said a dealer in Hong Kong. US President Barack Obama on Sunday urged an "orderly transition" to democracy in Egypt, stopping short of calling on President Hosni Mubarak to step down but signalling that his days may be numbered.