The dollar rally may have something to do with this decline, but it is an odd event given the view that gold is perceived as a safety instrument.The VXX index has fallen from its highs but is still at elevated levels. Gold is at early August levels.
Stock are still in a range but there has been a clear movement to higher levels since the lows in late September. We think the optimism in the gold market is misplaced. There is room for gold to retouch highs as the EU debt and banking crisis continues.