Dec 12 (Reuters) - Gold was slightly higher on Tuesday, just up from its lowest in nearly five months in the previous session, and ahead of the start of a two-day U.S. Federal Reserve meeting. Spot gold rose 0.2 percent to $1,244.74 an ounce by 0736 GMT, after hitting its lowest since July 20 at $1240.10 on Monday. U.S. gold futures fell 0.1 percent to $1,246.30 an ounce. "Bullion staged a modest recovery during Asian trade today as demand out of China underpinned price action," MKS PAMP trader Sam Laughlin said in a note. Meanwhile, the dollar was slightly weaker versus the yen but held firm near two-week highs versus a basket of major currencies as traders awaited results from the U.S. Fed's policy meeting for a fresh catalyst. "I would expect gold to remain offered on any rally and ... to retest its overnight lows around $1,240," said Jeffrey Halley, a senior market analyst with OANDA. "I think that gold has shifted into a new trading range of $1,210-$1,260 from $1,260-$1,310 and if the Federal Open Market Committee statement is hawkish gold will come under pressure again." At the meeting, which concludes on Wednesday, the U.S. central bank is widely expected to raise benchmark interest rates for the third time this year and comment on the pace of further rate hikes. "We expect a steady grind lower in gold, at least through Wednesday," said INTL FCStone analyst Edward Meir. "Depending on how hawkish the wording is, gold could drift lower still, as charts do not show any meaningful support at least until $1,205-$1,210," Meir said. Gold is sensitive to rising U.S. interest rates, as these increase the opportunity cost of holding non-yielding bullion and boost the dollar, in which it is priced. Analysts at Standard Chartered noted that gold would likely recover quickly from its recent lows if the meeting outcome proves to be a dovish hike. Reuters technicals analyst Wang Tao said spot gold may bounce moderately to a resistance at $1,250 per ounce, as it has stabilized around a support at $1,239.