Summary:
- Markets are currently focusing on the rise in US-North Korean tensions
- Trump has just responded to the latest raising of the ante
- Gold rising strongly to 8-week high
The Asian session and European morning was dominated by the latest escalation in tensions between North Korea, with both sides swiftly ratcheting up their rhetoric to unprecedented levels. US President Trump told a reporter last night that any further threats to the US would be met with “fire and fury” and within a matter of hours North Korean state media was reporting that Pyongyang are considering an attack on Guam – a US pacific territory where an air base is located.
The focus then shifted back to the US and Trump has responded once more in the past hour through his favoured medium of Twitter. Trump wrote:
“My first order as President was to renovate and modernize our nuclear arsenal. It is now far stronger and more powerful than ever before..”
Before shortly following with:
“Hopefully we will never have to use this power, but there will never be a time that we are not the most powerful nation in the world.”
These messages have done little to calm the skittish markets with Gold (+0.84%) popping above 1270 to trade at its highest level of the day in recent minutes.
Gold prices have surged higher since Trump’s comments last night. The precious metal has now gained more than $15. Source: xStation
If we look at the bigger picture, the rally that started last night appears to have changed the course of the price of Gold and it has just broken above the recent high at 1274. Another attempt at the 2017 peak at 1295 is now possible.
Gold has broken above its recent high and may now attempt to retest the 1295 level – the 2017 high. Source: xStation