Gold: steepest daily rise since mid-May

Gold has rallied on the session and made its steepest daily rise since mid-May while investors scramble for cover from a war of words between the U.S. and North Korea.

Gold has tallied up about $20.00 on the session due to North Korea’s retaliation to Trump's "fire and fury" comments yesterday. The North Koreans have threatened to launch a missile strike at U.S. territory Guam.

• US dollar to continue its downtrend as global growth picks up - Wells Fargo
• US congresswoman confident Guam protected from N. Korea threat - RTRS
• US and North Korean aggression is the main driver today - BBH

However, gold is still in recovery of the June high sell-off from $1,296 and that is the key level of interest for gold to be a convincing turnaround. Safe haven flows will not sit idle for long and investors will instead be looking for a yield eventually. Such outflows, if the situation calms down, would be expected to cause a collapse in the price. To the downside, $1,251.50 and $1,243.70 are previous near term supports ahead of pivotal $1,235.