When Parabolic Gold Peaks, Stocks Typically Drop The stock market tends to decline when gold peaks from high-velocity rallies. Will it be different this time? My graphic highlights the metal rolling over from its greatest premium to the 20-quarter moving average since 1980. Around the time gold topped out at 1.7x vs. this mean in 2008, the S&P 500 embarked on an almost 60% drawdown. A return to its 20-quarter average would imply a roughly 25% SPX decline. Gold's 1Q high was about 1.9x its mean -- well above 2008's peak. Strong fundamentals have driven both gold and stocks to nosebleed levels, and the global energy crisis may be a worthy catalyst for wealth reversion. What I find disconcerting is that an adjustment could be simple mean reversion at this stage. The S&P 500 falling below its 20-quarter mean of 5,162 vs. 6,817 on April 10 might suggest a recession. Full report on the Bloomberg here: https://blinks.bloomberg.com/news/stories/td2hedkgzaji {BI COMD} #gold #stockmarket @BBGIntelligence(Mike McGlone)