Gold climbs to weekly tops, around $1338 level

• US-China trade tensions continue to benefit traditional safe-haven assets.
• Increasing Fed rate cut bets weighed on the USD and remained supportive.

Gold edged higher through the early European session on Thursday and is currently placed at the top end of its weekly trading range, above the $1335 level.

After the previous session's late pullback, a combination of supporting factors helped the precious metal to regain positive traction for the second consecutive session on Thursday. Numerousness amid fears of a further escalation in the US-China trade tensions continued benefitting traditional safe-haven assets and turned out to be one of the key factors lending some support. 

The risk-off mood was evident from declining US Treasury bond yields, which kept the US Dollar bulls on the defensive and underpinned the dollar-denominated commodity. Meanwhile, expectations for an eventual Fed rate cut move were reinforced by Wednesday's softer US consumer inflation figures, which further collaborated towards driving flows towards the non-yielding yellow metal.

In absence of any relevant market moving economic releases, it would be interesting to see if the commodity is able to capitalize on the positive move and aim back towards testing a key barrier near the $1346-48 zone, or yearly tops touched in reaction to last week's weaker US monthly jobs report.

Technical levels to watch