Gold eases from tops, back below $1320 level

   •  A goodish rebound in the US bond yields prompts some weakness.
   •  Weaker USD/negative European equities should help limit downside.

Gold pared a major part of its early uptick to an intraday high level of $1322.35 and has now retreated back to the lower end of its daily trading range. 

The latest leg of steady decline since the early European session could be attributed to a sudden pickup in the US Treasury bond yields, which tends to drive flows away from the non-yielding yellow metal.

The downside, however, remained cushioned amid the prevalent negative trading sentiment around European equity markets. Moreover, the ongoing US Dollar profit taking slide, which started last week, might further contribute towards limiting any deeper slide for dollar-denominated commodities - like gold. 

Currently trading around the $1319 region, the precious metal now seems more likely to enter a consolidation phase amid absent fundamental drivers in terms of any major market moving economic releases from the US.

Technical levels to watch

A follow-through retracement is likely to find support near the $1314 horizontal zone, below which the commodity could slide back towards the $1310 strong support. On the upside, $1322-23 area now seems to have emerged as an immediate hurdle and is followed by 100-day SMA barrier near the $1326-27 region.