Gold is glistening.
Gold is now above its $1,613.30 January high — the commodity's highest level since March 2013 — as investors use the commodity as a hedge amid global volatility. Gold hit an intraday high of $1,615.90 an ounce in Wednesday's trading session before cooling off slightly to $1,614.60. On Thursday, it rose to $1,619.90.
John Petrides, portfolio manager at Tocqueville Asset Management, told CNBC's "Trading Nation" on Wednesday that gold is a necessity for a diversified portfolio and as insurance against volatile market swings.
"We're in an environment where bond yields stink, stock valuations continue to creep higher [and] the U.S. debt situation is 22 trillion and going higher," Petrides said. "So, in a well-diversified portfolio, I think you need to have gold here to offer solid diversification, despite the fact that gold is hard to value. … You need to prepare for that 'black swan event.'"
Investors tend to gravitate toward gold when economic uncertainties, such as the current coronavirus outbreak, arise. Analysts at Citigroup grew more bullish on gold on Wednesday, predicting a high of $2,000 in as little as a year.
Matt Maley, managing director of Miller Tabak, said from a technical analysis, he stands by Citi's bullish call.
"You saw [gold] break above its closing highs [Tuesday]. That's very bullish," Maley said in the same "Trading Nation" interview, referencing a chart of the precious metal.
"Even before that, it was setting up very nicely because its old breakout level, its old resistance level, was $1,550. It broke above that at the very beginning of the year and then … that old resistance level became new support," Maley said. "It came back down to that level [in] early January, held it very nicely [and] bounced strongly to a new high. So, the intraday high there is $1,611. You break much above that and that will confirm that the next leg is going higher."
As concerns grow over the coronavirus's effect on the market, institutional investors have "no choice but to stay with the market as it rallies, and they need a little something to hedge that with the coronavirus and all the other issues," Maley said.
For now, gold seems to be fulfilling that need.
Gold is currently on track for its best week since Jan. 3.
Disclosure: Tocqueville Asset Management owns gold.