"I cannot help but notice that we may be experiencing a re-run of 2007/08 when equity markets peaked out at the end of 2007 but gold continued to rise until mid March 2008 and then started falling. Do you see a similar scenario playing out again?"

Eoin Treacy's view Thank you for this interesting question which I'm sure will be of interest to other subscribers. As you point out gold was an initial beneficiary of the stock market's deterioration. However, it was not immune from the seizing up of credit lines that followed the Bear Stearns and Lehman Brothers bankruptcies. It fell sharply although not as much as most stock markets.

At present gold is also benefitting from the weakness of stock markets and the heightened sense of anxiety that has been manifested over the last few weeks. We would be best served to continue to monitor the chart action. Gold continues to exhibit safe haven status. We have no guarantee that this will continue indefinitely. Another Lehman Brothers incident remains an outside possibility. Gold's price action will tell us when the first sign of supply dominance appears. Considering gold's secular bull market, the more overextended it becomes relative to the 200-day MA, the closer it will be to the next reversion.