Gold erases early tepid gains, back around $1325 level

   •  USD selling pressure seems to have abated.
   •  Fading safe-haven demand fails to lend support.

Gold trimmed a major part of its early tepid gains, back closer to yesterday's one-week tops, and has now retreated towards the lower end of its daily trading range. 

Against the backdrop of yesterday's disappointing US monthly retail sales data, concerns over a possible global trade-war weighed on the US Dollar and underpinned demand for dollar-denominated commodities - like gold.

Adding to this, trade-war fears triggered some risk-off trade during the Asian session and provided an additional boost to the precious metal's safe-haven appeal, lifting it to an intraday high near $1328 area. 

The USD bearish pressure now seems to have eased a bit, which coupled with indications of a positive opening across European bourses capped any additional gains and prompted some selling at higher levels. 

Meanwhile, the recent price action over the past one-week or so, within a broader trading range, clearly to suggest indecision over the commodity's near-term trajectory. Hence, it would be prudent to wait for a decisive breakthrough in either direction before positioning for the next leg. 

Technical levels to watch

Any subsequent retracement below $1321-20 area is likely to find support near $1316 level and is followed by support near $1313-12 area. On the upside, $1328-30 zone might continue to act as an immediate hurdle, which if cleared could accelerate the up-move towards testing $1340 heavy supply zone.