Gold is not for inflation, but for what comes after the ‘good’ inflation runs its course
It has been one big trade on inflation. Notice how SPX, DJW and copper are all still nicely correlated to the inverse of the USD. Notice also how gold is bouncing with the other stuff but really just correcting some of its extreme downside behavior as the bugs regurgitated in March.
Regardless of whether the cyclical stuff remains on trend or goes bearish, or gold remains in its downtrend or busts out of it, the utility for gold is illustrated right here on this chart. It is in its negativity to the other items’ positivity that gold has value in this market phase. That’s a long way of saying “insurance”. Remember, you don’t want to root for your insurance to pay out because it means a negative event or disaster of some kind came about.
Gold is fine. It’s the casino patrons lumping it with everything else that distorts the view.
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