Comex gold futures added around $1.00, or about 0.1%, to $1,260.29 a troy ounce by 8:00AM ET (12:00GMT).
The most active gold contract for June delivery declined by 5.9 US dollars, or 0.47 percent, to settle at 1,252.80 dollars per ounce.
There were media reports of a leaked memo written by former FBI Director Comey which suggested that Trump had asked for the investigation into former National Security Adviser Flynn to be stopped.
"(Gold) is seeing a pullback after yesterday's strong performance - it needs to take a breather", said Heraeus precious metals trader Alexander Zumpfe.
Pressure on US President Donald Trump deepened after reports that he tried to interfere with a federal investigation.
"This is related to a flare-up of geopolitical risks with what's happening in the US with Trump and Russian implications", Capital Economics analyst Simona Gambarini said. The White House subsequently rubbished the allegation.More news: Roger Ailes, media guru and political strategist, dies at 77
Gold became a safe haven for investors overnight, finishing at a two-week high, as the escalating circumstances surrounding Trump led to the USA stock market being hammered. An unexpected fall in USA homebuilding meanwhile added to a run of weak economic data, raising new doubts about how many times the Federal Reserve will raise interest rates this year.
Gold prices pared gains as the USA dollar came off its lows and US 10-year Treasury yields bounced up from a 1-1/2-week low.
An unexpected fall in US homebuilding meanwhile added to a run of weak economic data, raising new doubts about how many times the Federal Reserve will raise interest rates this year. Spot gold may end its current bounce in a narrow range of $1,229 to $1,236.60 per ounce, and then revisit its May 9 low of $1,214, according to Reuters technical analyst Wang Tao. We have also seen the market expectations of a rate hike in the United States in June begin to evaporate, amidst the heat of the political debate in the USA and this is again a dollar negative and we are seeing some roll back in the pricing in of the rate hike over the last couple of days.
European shares were down 0.8 percent on Thursday, while world stocks extend their steepest fall in more than six months.
In other precious metals, silver was up 1.1 per cent at $US16.63 an ounce, after money managers cut their net long stance in silver to the smallest since February 2016 from a record high last month. USA gold futures rose 0.3pc to $1,234 an ounce.
Bullion of 99.99% purity advanced 0.4% to 277.80 yuan a gram ($1 255 an ounce) on the Shanghai Gold Exchange.