I’ve been following the relationship between bonds, stocks, and commodities for some time, and have noticed some interesting shifts over the last few months.
Last month, I outlined some relative strength relationships between gold and various asset classes, where I included various levels to watch: https://dash-charts.com/2024/03/10/can-gold-outperform/
Gold has been flirting with resistance zones of outperformance compared to bonds, stocks, and commodities – and has just recently crushed them all. Except for one.
The precious metal is still sitting in the waiting room with regards to outpacing commodities.
My assumption is that the possible breakout isn’t too far behind.
Gold vs NASDAQ Composite ($NASDAQ)
You can see at the start of April, Gold made a run for the hills compared to the Nasdaq Composite.
The more times a level or zone is touched, the more significant it is when that level is finally broken.
Gold vs S&P 500 ($SPX)
This looks familiar.
The ratio chart of gold compared to the S&P 500 looks almost identical to the comparison to the Nasdaq. More gold outperformance.
Gold vs Dow Jones Industrial Average ($DJI)
Wow.
Stellar job by gold here.
Not only breaking out of its similar resistance zone that we saw in the two previous comparisons, but even breaking through its resistance zone of yearly highs.
Old Dow, you don’t look too great my friend.
Gold vs Bonds ($TLT)
Have you heard of the ordering of the asset cycle? Bonds, then stocks, then commodities?
Bonds move first. Then stocks follow. Then commodities. That’s how I learned it.
We can clearly see that gold began its graceful takeover by first outperforming bonds. Bonds also began falling first. What’s next in line?
Gold vs Commodities ($CRB Index)
Zooming out a bit more for this one to show how “valid” this zone is. By “valid” I mean how many times price has come into contact with this zone.
Using a 5-year weekly chart, you can see gold is wedged right in the middle of its resistance zone for outperforming other commodities. It typically has a history of leading overall commodity price levels.
Is it time for gold to shine here too?
It’s been polishing up for something!
Dash Charts 
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