Gold pares early losses, jumps back around $1300 mark

   •  Trade-related headlines trigger safe-haven buying in the past hour.
   •  A modest USD retracement/weaker US bond yields supportive of the uptick. 

Gold pared some of its early losses and might now be looking to build on its momentum back above the $1300 round figure mark.

The precious metal extended overnight sharp retracement slide from one-month tops and dropped to an intraday low, near the $1297-98 region amid a strong follow-through US Dollar buying interest.

Against the backdrop of a hawkish Fed rate hike on Wednesday, yesterday's dovish ECB taper and BoJ's weaker inflation outlook on Friday continued benefitting the greenback and kept exerting downward pressure on dollar-denominated commodities - like gold.  

However, a Reuters report, which said that the US is prepared with a second list of tariffs on $100 billion in Chinese goods, revived worries of a full-blown trade war and triggered a bout of safe-haven buying, which was seen as one of the key factors behind the latest leg of sharp spike over the past hour or so.

Adding to this, retracing US Treasury bond yields, which tends to revive demand for the non-yielding yellow metal, might further contribute towards limiting any deeper losses, at least for the time being. 

Technical levels to watch

Any subsequent up-move might continue to confront some fresh supply near the $1307-09 region (200-DMA), which if cleared decisively should lift the commodity further towards $1314-15 intermediate hurdle en-route the $1322-23 supply zone. 

On the flip side, $1298-97 area now seems to have emerged as an immediate support, below which the metal could slide back towards $1292 level ahead of its next major support near the $1287-86 region.