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Gold price surged to new record high at $4600 in early trading on Monday, as the latest clash between President Trump’s administration and Fed Chair Powell, on a criminal probe to Fed chief, which raises big question mark above the independence of the US central bank, further fueled uncertainty, as political crisis in the US deepens.

Situation in Iran remains very fragile and marks another key driver of the latest strong rise of demand for safe haven assets with US threats to attack the country and Iran expressing readiness for strong response, boosted migration into safety.

Gold opened with slight gap higher on Monday and easily broke through previous all-time peak, to crack psychological $4600 barrier.

Fresh rally rose again above the upper boundary line of the bull-channel (from late October correction low) that generated fresh bullish signal, as the price made another record fast move from one to another round-figure levels.

However, $4600 resistance is likely to cause headwinds as daily studies are overbought, but limited consolidation with shallow dips to provide fresh levels to re-enter bullish market.

Former top and bull-channel trendline offer initial but solid support at $4550, with extended dips to find firm ground at $4500 zone and keep bulls intact.

Sustained break of $4600 to expose projected targets at $4630; $4687 and $4700 initially, though stronger acceleration cannot be ruled out as all fundamental factors remain very favorable, with focus on highly sensitive geopolitical situation.

In such environment, the yellow metal is likely to extend steep rally which commenced in August, after three month consolidation (May/June/July) which was expressed by three tight monthly Doji candles.

Res: 4630; 4687; 4700; 4750.
Sup: 4550; 4500; 4452; 4429.

Eurozone investor confidence improved at the start of the year, with Sentix Investor Confidence Index rising from -6.2 to -1.8 in January, well above expectations of -5.1 and the strongest reading since July. The rebound was broad-based, with the Current Situation Index climbing from -16.5 to -13.0 and the Expectations Index jumping from 4.8 to 10.0, both also six-month highs.

Sentix noted that the improvement reflects a narrowing gap between professional and private investors. While institutional investors had already turned more optimistic in recent months, private investors had remained sceptical. That dynamic is now shifting, with private investors beginning to join the recovery narrative, even though differences in outlook between the two groups remain historically large.

Inflation concerns are also easing at the margin. Sentix’s Inflation Barometer shows expectations for slightly softer price pressures, helping to reduce stress on bond markets. However, Sentix cautioned against assuming renewed central bank support, warning that as the recovery takes hold, ECB policymakers are "unlikely to feel much incentive to act".

Full Eurozone Sentix release here.

The USD/JPY pair paused on Monday after a sharp rally to around 157.95, with the yen holding near its lowest levels of the year. Trading activity was subdued as Japanese markets were closed for a public holiday.

Political uncertainty increased after Prime Minister Sanae Takaichi, a key coalition partner, raised the possibility of early elections on 8 or 15 February, adding another layer of caution to the market.

The yen also faced pressure from recent mixed macroeconomic data, which have clouded the outlook for the Bank of Japan’s future rate-hike trajectory.

Last week, BoJ Governor Kazuo Ueda reiterated that the central bank would continue to raise interest rates if economic momentum and inflation align with forecasts, while also emphasising a flexible approach to policy adjustments.

Over the coming week, traders will focus on a series of key Japanese economic indicators, including current account figures, machine tool orders, manufacturing PMI, and business sentiment data. Any surprises could prompt a shift in the yen’s direction.

Technical Analysis: USD/JPY

H4 Chart:

On the H4 chart, the pair has completed a local advance to 157.77 and is likely to enter a period of consolidation around this level. A break below this range could trigger a corrective move towards 156.60. Conversely, an upward break would open the potential for the rally to extend towards 159.33. This outlook is supported by the MACD indicator, with its signal line positioned above zero and pointing firmly upward, indicating ongoing bullish momentum.

H1 Chart:

On the H1 chart, the market is forming a consolidation range centred around 157.77, with interim boundaries at 158.18 to the upside and 157.50 to the downside. A downward exit from this range could see a decline towards 156.60, while an upward resolution would signal potential for a further move towards 159.33. The Stochastic oscillator aligns with this view, as its signal line is above 50 and rising towards 80, suggesting continued near-term upward momentum.

Conclusion

USD/JPY has entered a period of consolidation near annual highs, with direction likely to be determined by upcoming Japanese data and political developments. While the broader technical bias remains bullish, a break below 157.50 could signal the start of a short-term correction.

Asia Market Wrap - Japanese Markets Closed

US stock futures dipped on Monday after Federal Reserve Chair Jerome Powell announced that the Trump administration is threatening him with a criminal investigation, sparking fears about the central bank's independence.

S&P 500 futures dropped 0.6% after Powell disclosed that the Justice Department is demanding records regarding renovations to the Fed’s offices. This legal pressure marks a serious escalation in President Trump's ongoing dispute with Powell over interest rates, as the President pushes for deeper cuts and has even discussed firing the Fed Chair.

Conversely, Asian stock markets rose, driven by tech stocks, as investors were reassured by data showing the US labor market is slowing down but not falling apart. Please note that Japanese markets were closed for a holiday.

European Session - European Shares Slip

European shares dropped on Monday as political clashes in the US made market participants nervous.

The STOXX 600 index fell 0.2%, largely because bank stocks tumbled 1.1%. This decline was driven by President Trump's recent proposal to cap credit card interest rates at 10% for one year, which caused shares of Barclays to fall 4.5% and HSBC to dip 1%.

Market anxiety also rose after the Trump administration threatened to indict Federal Reserve Chair Jerome Powell..

In other news, AstraZeneca shares fell slightly after the company was removed from the Nasdaq-100 index, while the French biotech firm Abivax surged nearly 23% after its CEO spoke optimistically about the potential of their new experimental drug.

On the FX front, the US dollar dropped sharply on Monday, ending a five-day winning streak as political turmoil in the US prompted investors to sell American assets.

The currency fell nearly 0.4% against a basket of major rivals.

The Swiss franc was the strongest performer, rising more than 0.5% against the dollar, while the Euro climbed 0.44% to mark its best day in a month.

The dollar also weakened slightly against the Japanese Yen and the Chinese Yuan, with the exchange rate for the Yuan dropping to its lowest level in a week.

Currency Power Balance

Source: OANDA Labs

Gold prices broke through the $4,600 barrier for the first time on Monday, setting a new record alongside silver as investors rushed to buy safe assets.

This surge is largely driven by the escalating conflict between President Trump and the Federal Reserve, which has made traders nervous about financial stability.

Gold jumped 1.7% to trade around $4,585, after briefly peaking at $4,600.33 earlier in the day.

Silver performed even better, climbing over 5% to roughly $84 per ounce, following its own all-time high of $84.60.

Economic Calendar and Final Thoughts

Data is largely thin today with markets likely to focus on developments in the renewed Trump-Fed spat which could dominate and drive market sentiment in the early part of the week.

The risk of the dollar dropping significantly is high if there are more signs that the government is trying to control the Federal Reserve. To understand where things are heading, market participants should watch the bond market closely. If bond traders start betting on more interest rate cuts (short-term) or start worrying about the Fed's independence (long-term), the dollar could fall.

Specifically, if the difference between short-term and long-term bond yields grows sharply (a "steepening curve"), it would likely signal a drop in the dollar's value.

Another event that was expected to help the dollar this week is the Supreme Court's ruling on President Trump's tariffs, which could happen between Tuesday and Thursday. Market participants generally expect the court to rule against the tariffs.

However, right now, the market is too nervous about the fight between the White House and the Fed to buy dollars comfortably. Before market participants feel safe buying again, they need clarity on this political conflict.

If we end up with a mix of high inflation and a politically weakened Fed, it could cause serious concerns about the economy and lead to a major crash in the dollar's value as the week progresses.

For all market-moving economic releases and events, see the MarketPulse Economic Calendar. (click to enlarge)

Chart of the Day - FTSE 100

From a technical perspective, the FTSE 100 index has finally breached the psychological 10000 mark.

Price has pulled back since with bouts of volatility and that shouldn't be a surprise. When price breaches such psychological levels we do tend to see some volatile price swings.

The main concerns for bulls at the moment is that the index appears as though we have printed a double-top pattern on the four-hour timeframe as well, a sign that a potential pullback could materialize.

Immediate support which may be tested in the near-term include the 9973 and 9943 handles respectively.

However, a key level on the four-hour chart for bullish continuation will be the psychological 10000 mark. A break of this level could bring a deeper correction into play.

FTSE 100 Index Four-Hour Chart, January 12, 2026

Source: TradingView.com (click to enlarge)

Capital flows into gold amid rising geopolitical and broader market risks, together with Jerome Powell’s remarks about potential criminal prosecution, have not only driven XAU/USD to record highs (as discussed earlier today) but have also put pressure on the US Dollar Index (DXY).

Markets are also digesting the latest Non-Farm Payrolls data released on Friday. The figures pointed to a slowdown in the US economy, with actual job growth at 50K versus expectations of 66K. This reinforces the case for interest-rate cuts and acts as a bearish factor for the US dollar.

As a result, the dollar index is moving lower today.

Technical Analysis of DXY

In the final days of 2025, when reviewing the DXY chart, we:

→ reaffirmed the descending channel (highlighted in red);

→ suggested that it would remain a key technical guide into early 2026.

This view has been confirmed, as the upper boundary of the channel is acting as strong resistance. Today’s decline appears to be a reversal from this level. In this context, it is reasonable to assume that:

→ the recent move represents an intermediate A–B–C corrective rise within a broader downtrend, with point C coinciding with RSI overbought conditions;

→ the short-term upward trajectory (marked by blue lines) may soon be broken by sellers. If the broader downtrend resumes, DXY could slide towards the median of the descending channel.

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Market Overview

The crypto market capitalisation grew by 1% over the past day and is down 1% from a week ago. Bitcoin received a boost from reports of a criminal investigation against the head of the Federal Reserve, which created momentum for a flight from US assets. In our view, this precedent is negative for risk appetite.

Bitcoin jumped to $92,500 but saw a significant influx of sellers, returning to $90,300 at the time of writing. Testing of the 50-day moving average as support continues. A slip below $90K could have a strong psychological effect, quickly taking the price to $87K and then sending it lower below $80K.

XRP is losing for the seventh day in a row, like Bitcoin, rolling back to the 50-day MA and close to the round level of $2.0. The coin is still up 10% since the beginning of the year, but the initial momentum has clearly lost steam, as there are too many people in the markets willing to sell on the rise. Most likely, this change in strategy for all

XRP has fallen for the seventh day in a row, once again finding itself on the verge of $2.0.

News Background

The total open interest in Bitcoin derivatives has fallen to its lowest level since the end of 2022, according to CryptoQuant. Historically, reaching such levels has preceded periods of consolidation or even bullish reversals.

Bitcoin could reach $2.9 million by 2050 in a base case scenario, according to VanEck’s forecast. This will happen if the first cryptocurrency becomes a currency for international settlements and enters the reserves of central banks. The main obstacle to mass adoption remains the scalability of the network. VanEck emphasised the importance of developing second-level solutions that will speed up transactions and reduce commissions.

Monero (XMR) is regaining its status as the leading anonymous coin amid the crisis in the Zcash ecosystem following the departure of its development team. The asset has been growing steadily for several weeks, outperforming most of its competitors in the sector.

There are more and more signs in the crypto market pointing to the end of the sell-off. Among them are the stabilisation of outflows from ETFs, the situation with perpetual futures and positions on the CME, according to JPMorgan.

MSCI’s decision on 6 January regarding companies accumulating cryptocurrencies is also favourable for cryptocurrencies. The global provider of stock indices has decided not to exclude them from its indices during the review in February 2026.

Daily Pivots: (S1) 210.72; (P) 211.39; (R1) 212.36; More...

GBP/JPY's rally resumed by breaking 212.13 temporary top and intraday bias is back on the upside. Sustained trading above 61.8% projection of 184.35 to 205.30 from 199.04 at 211.98 will extend current up trend to 100% projection at 219.99 next. For now, outlook will stay bullish as long as 210.28 support holds, in case of retreat.

In the bigger picture, up trend from 123.94 (2020 low) is in progress. Next target is 61.8% projection of 148.93 (2022 low) to 208.09 (2024 high) from 184.35 at 220.90. On the downside, break of 205.30 resistance turned support is needed to indicate medium term topping. Otherwise, outlook will stay bullish even in case of deep pullback.

Daily Pivots: (S1) 182.87; (P) 183.42; (R1) 184.29; More...

EUR/JPY is still bounded in range below 184.89 despite extended recovery. Intraday bias stays neutral for the moment. On the downside, below 182.60 will extend the correction from 184.89 to 55 D EMA (now at 180.92) and below . But strong support should emerge from 180.07 cluster (38.2% retracement of 172.24 to 184.89 at 180.05) to bring rebound. On the upside, firm break of 184.89 will resume larger up trend to 186.31 fibonacci level.

In the bigger picture, up trend from 114.42 (2020 low) is in progress and should target 61.8% projection of 124.37 to 175.41 from 154.77 at 186.31. Considering bearish divergence condition in D MACD, upside could be capped by 186.31 on first attempt. Still, outlook will stay bullish as long as 55 W EMA (now at 172.18) holds, even in case of deep pullback. Sustained break of 186.31 will pave the way to 100% projection at 205.81 next.

Daily Pivots: (S1) 0.8670; (P) 0.8678; (R1) 0.8690; More…

Intraday bias in EUR/GBP stays neutral for the moment, and risk stays on the downside as long as 0.8720 support turned resistance holds. On the downside, decisive break of 0.8631 cluster support (38.2% retracement of 0.8221 to 0.8663 at 0.8618) will pave the way to 61.8% retracement at 0.8466. Nevertheless, sustained break of 0.8720 will bring stronger rally back to 0.8796 resistance instead.

In the bigger picture, rise from 0.8221 medium term bottom (2024 low) is seen as a corrective move. Upside should be limited by 61.8% retracement of 0.9267 to 0.8221 at 0.8867. Sustained trading below 55 W EMA (now at 0.8622) should confirm that this corrective bounce has completed. In this case, deeper fall would be seen back to 0.8201/21 key support zone. However, decisive break of 0.8867 will suggest that EUR/GBP is already reversing whole decline from 0.9267 (2022 high). That should pave the way back to 0.9267.

Daily Pivots: (S1) 1.7374; (P) 1.7410; (R1) 1.7430; More...

Intraday bias in EUR/AUD remains neutral for the moment. Risk will stay on the downside as long as 1.7477 support turned resistance holds. Current decline is seen as the third leg of the corrective pattern from 1.8554. Below 1.7287 will target 1.7245 support, and then 1.6922 fibonacci level. Nevertheless, firm break of 1.7477 will indicate short term bottoming, and bring stronger rebound back to 55 D EMA (now at 1.7636).

In the bigger picture, the break of 55 W EMA (now at 1.7468) argues that fall from 1.8554 medium term top is already correcting whole up trend from 1.4281 (2022 low). Deeper decline is in favor to 38.2% retracement of 1.4281 to 1.8554 at 1.6922, and possibly below. Risk will stay on the downside as long as 1.8160 resistance holds, in case of strong rebound.