At the end of the US trade session on Tuesday, the ambassador of North Korea said that the country is preparing for 6th nuclear test. These news influenced negatively DJIA and S&P, which lead to the negative close of the trade session. DJIA lowered with 74.24 point during the news and finished with 36.50 point decrease, and S&P closed with 2.46 points lower.
But according to Bruce Bennet, senior defense analyst in Rand Corp, there is no need to worry. "North Korea can't reach our shores with any weapon. We can neutralize every attempt of attack. But the countries in the region must be careful." he said.
But these news were positive for other instruments. In the matter of couple minutes, USD/JPY fell from it's high ( 114.30 ) to level 113.75. Other winner from this was GOLD. The precious metal climbed back from it's bottom at 1214$ to 1223.69 $ during the news.
We expect the hedging instrument to be appreciated during today's sessions considering the increasing tensions. If there are other statement or threats from North Korea, most likely JPY and GOLD will be the biggest winners.
Trader Bozhidar Arabadzhiev
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