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* Graphic: 2021 asset performance http://tmsnrt.rs/2yaDPgn
* Gold retreats on stronger dollar (Recasts, adds comments, updates prices)
By Sethuraman N R
May 4 (Reuters) - Palladium soared to an all-time high on Tuesday, extending a record run driven by concerns of a shortage of the metal used in emissions-controlling devices for automobiles.
Palladium XPD= was up 1.2% to $3,007.66 per ounce at 1136 GMT, after jumping to a record of $3,017.18.
Prices of the autocatalyst have jumped about 21% since mid-March when top producer Nornickel GMKN.MM announced disruptions at two mines, exacerbating market concerns about a shortage.
"Palladium lives in its own world with low liquidity and strong momentum potentially taking it higher still," said Ole Hansen, head of commodity strategy at Saxo Bank, adding however, the metal may be at risk of a price correction, "especially if it fails to hold onto the $3,000 mark."
Chronic undersupply shot prices from around $500 an ounce in 2016 up to $2,875.50 just before the coronavirus outbreak began.
A shift to electric vehicles may eventually erode demand, but tightening environmental rules have forced carmakers to use more and more palladium in gasoline engines. meanwhile, retreated on a stronger dollar.
Spot gold XAU= was down 0.6% to $1,782.45 per ounce, after hitting its highest since Feb. 25 at $1,797.75 on Monday.
Carlo Alberto De Casa, chief analyst at ActivTrades, said technical factors were pressuring gold, while "the U.S. dollar's recovery is making it more complicated".
"We have two important support levels at $1,765 and $1,750, while a clear surpass of $1,800 would open up space for bullion."
The dollar index .DXY rose 0.4% as investors weighed chances that U.S. interest rates will be forced higher by a roaring U.S. economic recovery, reducing bullion's allure for other currency holders. USD/
Higher interest rates increase the opportunity cost of holding non-yielding bullion.
Investors await U.S. services data on Wednesday and April payrolls on Friday. XAG= was down 0.2% at $26.83, after hitting its highest since March 1 on Monday, while platinum XPT= rose 1% at $1,241.95.
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