Revisiting the T Bond / Gold Relationship

We had projected some issues for gold when a short-term top developed for long-term Treasury bonds due to the bound at the hip relationship between the two risk ‘off’ vehicles earlier in the year. Here is the view of the 30yr yield and gold, which have been like looking in a mirror in 2019 (the yield going opposite the bond).

tyx and gold

So what of the relationship now? TLT looks like it is regenerating its bullish look both in price (incl. dividends) above the SMA 50 and in the lower panel momo indicators.


GLD on the other hand is bouncing to its SMA 50 and looks more bearish as it tries to negate the minor H&S pattern. I haven’t drawn it in, but gold is back above its neckline. The indicators look suspect.


Now I ask you, is it better for gold to resume a correction and decouple itself from the T bond or get with its program now and fully recover? The reason I ask is because I think there is going to come a day that the bond tanks as long-term yields rise and I don’t think gold bugs would want to be tied to that hip.

Interesting, anyway.

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