Analysts often cite intermarket relationships when touting a market s prospects.
An analyst might point out that utility stocks have reached a new high, and since they lead interest rate instruments, the fixed-income market would follow. Or an analyst might observe that copper is down, and since copper is a key price component for inflation indices, lower copper prices is bullish for bonds. When you examine the historical data and compare the impact that one market may have on another, however, some such relationships do not actually exist, and further, most of the relationships that do are not strong. But some do, and they are worth noting. One key barometer is the price of gold.