you win .. i lose .. you lose .. i lose

The majority of gold stocks continued their ugly under performance.

Following the Dow rising over 400 points our market was full of green.For example:

All Ords up 185 points
Energy up 327 points
Materials up 311 points

But there was one exception.

Gold index down 195 points with leaders like LGL down 21c to $4.04 and NCM down $1.49 to $36.00.

So when the Dow rises strongly, gold falls and gold stocks get savaged.

Now imagine if the Dow gives back 200 points of yesterday's 400 points rise tonight and gold rises, then will most gold stocks rise tomorrow?

The odds are: NO. OF COURSE NOT.

Negative market sentiment will then send most gold stocks further down.

At present, despite gold being around US$1000 sentiment for gold shares is the worst it has been in years.

The gold price is clearly in a bull run while most gold stocks are behaving as if gold was in a long term bear market.

If the gold price falls gold stocks are immediately smashed even if everything else is rising, while if the gold price rises the market finds excuses like negative market sentiment to ignore the rise and smash most gold stocks.

The correlation between the gold price and the price of gold shares becomes crazier and crazier day by day as more burnt investors flee gold shares in the belief that nothing will make gold shares have a sustained run.