Gold fell sharply in late trading on Tuesday following a strong US jobs report and reports that Hezbollah backed calls for a ceasefire in its conflict with Israel.
Signs of a possible easing of the Middle East conflict open the door for market participants to pull their capital out.
At 9.30am, the price of gold was at $2,618.57 which is down 0.12% since it opened in early trading on Wednesday.
US equities remain supported by an improvement in market sentiment. The yellow metal remains at an all-time high due to the escalating Middle East conflict.
However, signs of a possible resolution of the conflict will trigger an outflow from safe assets to riskier ones.
According to CNN, Hezbollah's top officials support efforts for a ceasefire in Lebanon.
For now, investors are placing interest rate expectations on the next steps of the Federal Reserve (Fed).
Most Fed officials set the tone for monetary policy easing at the next meeting. Fed President St. Louis, Alberto Musalem proposed only one cut by the end of the year after implementing a 50 basis point cut in September.
In addition, the USD currency moves to strengthen gains in the near future because next week's US economic data will show the release of Inflation data, Fed Meeting Minutes, Initial Jobless Claims and University of Michigan Consumer Sentiment.
