The price of gold fell sharply today, while the dollar gained strength against nearly all the world's major currencies.

Analysts said no particular event triggered the decline in gold prices, but they cited both the strength of the dollar and strong statements about the need to contain inflation from Paul Volcker, President Carter's nominee to head the Federal Reserve Board.

Investors often buy gold as a hedge against inflation and as a refuge from a declining dollar.

Gold prices have been soaring in recent months, and they cracked the $300-an-ounce barrier two weeks ago following President Carter's firing of several Cabinet officials.

Analysts have been divided in recent weeks: Many feel that gold is overpriced, while others believe that it will continue to rise in value as inflation eats away at Europe and the United States.

Gold prices began to fall in Europe when most American traders were still asleep, and the decline continued when trading opened in New York and Chicago.

At the afternoon fixing in London, the price of gold was set at $301.40 an ounce. In the morning, the price had been set at $304.65.

In New York, Handy & Harman, a major gold dealer, set its base price at $301.65, down $4.15 from Friday. Handy & Harman sets the price once a day, at about noon. But after that, gold continued to decline in value.

In futures trading on the New York Commodities Exchange, the price of gold to be delivered in August closed at $296.20, which is $9.70 an ounce below Friday's close of $305.90. In trading of contracts promising delivery in September and October, the price delined$10 an ounce, the most the exchange will permit in one day's trading.

Similar declines were registered at Chicago's International Money Market, the other major U.S. exchange that deals in gold futures.

Trading in both gold and foreign currencies wasn't heavy in Europe or the United States, analysts noted.

Andre Sharon of Drexel Burnham Lambert said that the price of gold is too high in relation to supply and demand, and today's decline could be the start of a long-term fall in the price of the metal that could bring it down as low as $230 to $240 an ounce within the next year.

However, Sharon noted that although the price of gold is extremely rational in the long run, it can be extremely irrational in the short term. Emotions, fear, greed or panic can push the price of gold up or down dramatically Sharon said.

Another analyst said the key to gold prices is Arab buyers, who have been buying gold heavily during the last several months.

"If the Arabs should start to sell the gold they've been accumulating, the price will plummet," he warned. "On the other hand, if they should continue to buy, who knows what will happen?"

While gold prices fell, the dollar strengthened both in Europe and Japan. Analysts said that Volcker's strong anti-inflation platform and his commitment to defending the value of the dollar helped push up the U.S. currency.

The dollar could buy 1.8378 West German marks in New York today, up from 1.8205 on Friday. The Swiss franc closed at 1.6595 compared with 1.6422 on Riday, while the yen closed at 218.15 compared with 215.30 Friday.

While the British pound improved against the dollar in trading in London, it declined when trading moved to New York. The pound was worth $2.2910 in New York, compared with $2.3185 on Friday. CAPTION: Graph, The Market, July 30, The Washington Post