Gold deflates from peaks, back near $1,340.00/oz

After hitting fresh tops around $1,350 on Tuesday, the ounce troy of the precious metal is now giving away some gains and retreating to the $1,345/40 band.

Gold in fresh 1-year peaks

Bullion sustained its rally on heightened geopolitical concerns following the nuke test over the weekend and recent news citing the likelihood of another ICBM launch any time in the next days.

Further support for the yellow metal came from dovish comments by FOMC’s L.Brainard on Tuesday, who suggested the Federal Reserve should be more cautious when comes to future interest rate hikes against the current backdrop of subdued inflation pressures.

The US Dollar Index (DXY), in the meantime, keeps the soft note and trades in the 92.30 area amidst declining yields in the US money markets. Yields of the key 10-year reference stay in YTD lows around 2.07% at the time of writing, levels last visited in early November 2016.

Gold key levels

As of writing Gold is losing 0.03% at $1,344.08 facing the immediate support at $1,331.10 (low Sep.5) seconded by $1,321.99 (10-day sma) and then $1,315.31 (23.6% Fibo of the Juy-September up move). On the upside, a breakout of $1,349.70 (2017 high Sep.23 2016) would open the door to $1,350.50 (high Sep.7 2016) and finally $1,366.00 (high Aug.2).