Gold Breaks To 19-year Lows Relative To Nasdaq Stocks

JC Parets
December 30, 2020

When assets are in strong uptrends, they tend to not just do well on an absolute basis, but they also outperform their alternatives. In the case of stocks, some good alternatives would be Bonds and Gold. No, not bitcoin.

So with stocks all over the world breaking out to new highs, more and more stocks participating, and even the biggest laggards around the world catching a bid, how are they performing relative to their alternatives?

Well, here is Gold vs the Nasdaq Composite breaking down to new 19-year lows. The trend is strong in this one:

This is perfectly normal market behavior for bull markets.

Stocks are going up and Gold can't keep up. In fact, it's pushing down against multi-decade lows relative to the Nasdaq. Classic.

And for the record, it's not my fault that gold is hitting new multi-decade relative lows. I had nothing to do with it. I'm just pointing out the obvious trend.

Many times, the crazy gold people forget that. They blame me for them owning underperforming assets. I'm not sure why.

The trend is down for gold relative to stocks. Very down, in fact.

And I really don't care either way. Gold could double from here, or it can go to zero. I couldn't care less. That's not my problem.

I just want to be on the right side of the trend. And new multi-decade lows is not on my list of characteristics of uptrends.

JC

 

 

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