Gold hits 2-week lows, around $1320 level amid notable USD demand

   •  Fails to build on early recovery move, despite reviving trade war fears. 
   •  A follow-through USD demand prompts some fresh selling at higher levels.
   •  Focus remains on the keenly watched NFP report and Powell’s speech.

Gold erased early Asian session gains to $1333 area and tumbled to fresh two-week lows, around $1320 level in the last minute. 

The precious metal initially edged higher and reversed a major part of yesterday's downfall amid reviving safe-haven demand on reports that the US is planning to impose another $100 billion tariffs on China. 

The early uptick, led by a fresh wave of global risk-aversion trade, turned out to be short-lived, with some follow-through US Dollar buying interest prompting some fresh selling around dollar-denominated commodities - like gold. 

Even a weaker opening across European bourses, and sliding US Treasury bond yields, did little to lend any support and stall the commodity's downfall to $1320 level. 

Investors now look forward to the keenly watched non-farm payrolls data, which along with the Fed Chair Jerome Powell's scheduled speech would influence Fed rate hike expectations and eventually provide some fresh impetus for the non-yielding yellow metal.

Technical levels to watch

A follow-through selling pressure has the potential to continue dragging the metal further towards $1316 intermediate support en-route 100-day SMA support near the $1312 region.

On the upside, $1329 level now seems to act as an immediate hurdle and is closely followed by resistance near the $1332-33 region, above which the commodity might head back towards retesting $1340-41 supply zone.