Gold jumps back closer to $1270 level on rising geopolitical tensions

Gold extended previous session's recovery move from two-week lows and posted strong gains on Wednesday, now eyeing to move back above $1270 level. 

On Tuesday, stronger-than-expected JOLTS job openings data helped the US Dollar to recover early losses and dampened demand for dollar-denominated commodities, dragging the precious metal to $1252-51 region, the lowest level since July 26.

The weakness ended abruptly near 100-day SMA support after the US President Donald Trump warned N. Korea that it would be "met with fire and fury" if continues to make threats against the US. The tension escalated following N. Korea's threat to strike the US territory of Guam, which triggered a wave of global risk aversion trade and continued boosting the yellow metal's safe-haven demand. 

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It, however, remains to be seen if the up-move is sustained or fizzles out at higher levels amid reviving hopes for additional Fed rate hike action in 2017, which tends to drive flows away from the non-yielding metal. 

Technical levels to watch

Momentum beyond $1270 level could get extended towards multi-week high resistance near the $1275 region, above which the metal seems all set to aim towards testing its next major hurdle near $1279-80 area. On the flip side, $1263-62 zone now seems to protect the immediate downside, which if broken would turn the commodity vulnerable to head back towards retesting 100-day SMA support near the $1252-51 region.