Today's Chart of the Day was shared on Twitter by Piyush Chaudhry ( @piyushchaudhry). It's a line chart of Nifty and a ratio chart of Gold vs. Nifty 50 over the past 11 years. Piyush points out that Gold tends to outperform during the corrective period of Nifty 50. The ratio chart is helpful because it addresses opportunity cost, like which asset will provide better ROI. It's essential to keep in mind that divergences can persist for a while without any significant upside follow-through, and it's also possible that the Nifty gets its act together and reverses. But until we get that confirmation, be aware that this red flag exists. |
