Gold touched a four-month low of $1225 but has bounced back to nearly unchanged at $1240 as the kneejerk from an Iran nuclear deal fades.
A non-nuclear Iran would diminish tail risks in the global economy and reduce the demand for safe-haven assets.
Looking at the market, short-covering might have been a factor. There has been heavy trading in $1200 options today. Technically, the turnaround leaves some room for optimism on a continued close above the Aug-Oct trendline but I’d like to see a close above $1250 before any real optimism materializes.
