At the end of last month when it was alleged that President Assad used chemical weapons on his own people, the price of gold was pushed up as traders shied away from the uncertainty that comes with the possibility of conflict. Gold is deemed to be a quality asset, which means traders buy it when the risk factor is perceived to be high.
Russia has now suggested that Syria put its chemical weapons under the control of international hands, which has somewhat defused the situation, and militarily invasion of Syria appears to be less likely. Traders are consequently taking their money out of gold and investing it in risker assets once more, such as equities. If the old tensions start to flare up, however, we could see gold rally.
Dealers will also be keeping an eye on the US Federal Reserve as the most recent unemployment data shows that the jobless rate dropped to 7.3%, and the Fed is using unemployment as a benchmark for tapering. William Dudley of the Fed is making an announcement on Thursday; if he states that tapering could begin next month we could see the US dollar rally and the price of gold fall.