After being dismal at the beginning of last week, gold is shining brighter today, shining new hope for investors in the new year.
Compared to the flatter price movement overnight, gold surprised the Asian session this morning with a spike reaching a new high above the level reached at the end of December.
Although it managed to record gains against some of the major currencies, the US dollar slumped more than the safe-haven trade.
Thus, gold as a safe-haven asset is also seen to be under pressure as well as showing a surge in its value continuing into the European session this evening.
The XAU/USD price chart which measures the value of gold against the US dollar has seen the price surge past the resistance zone at 1830.00.
After the gold price held above the 1800.00 zone last week, there is a signal for a bullish move for the yellow metal if the price last Monday swings above the 50 Moving Average (MA50) support level on the 1 hour time frame on the XAU/USD chart.
In overnight trading, the price only reached a high level around 1825.00.
After today's surge, the price has reached a new high around 1850.00, a 7 month high on record.
With this bullish pattern, the gold price has the potential to be accelerated towards the next target at 1870.00 as well.
However, be careful if the fall in the value of gold takes effect again, the price will decrease back to the level of 1830.00 with an interesting price reaction to be expected.
If the downside is lower, the price will retarget the key zone at 1800.00 and investors will look for signs of a change in price trend for gold.
