One cannot expect gold to rise even as oil falls!!!

• Gold and oil are normally positively correlated.  More recent talk of divergence does not have historic backing. 
• Commodities' markets  should move together.
• If stock markets collapse, there is a wealth effect and there cannot be a flight to gold as is anticipated. 
• If there are are losses in one market, there will be sales of other assets to recoup losses.
• With deflation staring (in the event of bearish trends) gold loses attractiveness. 
• It is a different story if US  interest rates are hiked and inflations looks likely to rear. 
• The international scenario may hold the Fed's hands.
• Political imbroglio in Greece adds to European woes.
• If the Government of India cannot come out with a marketable plan for ensuring the transfer of gold holdings to banks (as is proposed) then there could be some stimulus for international gold.  The Indian banks seem  reluctant to offer more than 0.75 % interest to gold bonds. 
• If the Indian growth rate falls, following China, that would imply less purchasing power. 
• The Chinese stock market falls may have hit local Chinese hard given that 80 to 85 % of stock holders are nationals. 
• Against such a scenario, any move up in gold prices does not necessarily reflect real moves but expectations.
• If the Indian festive season picks up in October- November and if the Fed moves rates up, there could be a rebound of gold. Until then  any investor has to be cautious. 

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