What Can Happen to Gold When Stocks Pull Back?
Many investors wonder how they should expect gold prices to behave when there is a significant pullback in stocks. Looking at historical patterns when stocks retreat significantly, three key scenarios emerge regarding how gold prices are likely to behave. Those scenarios are ruled by the answers to three major questions, which we discuss below. The first question is, how fast do the stocks pull back? The speed at which stock prices drop is a key predictor of what could happen to the price of gold in that timeframe. When the drop is swift, gold prices are also likely to drop.…