Gold vs S&P negative correlation intact, precious metals in long bottoming process
The negative correlation between gold and S&P 500 is visible from September 2, 2011. HUI Goldbugs is down 64%, S&P 500 is up 43% while silver is down 48% and gold 28%. Demand for safe-haven investments decline when conventional investments are providing reasonable returns, he said.
Past history shows that decline in gold ended when the stock market peaked and hence both gold and silver could be in a long drawn out bottoming process.