Gold is being traded like a tech stock, says Peter Boockvar

Gold recently dipped below $4,000, a move Boockvar attributes to forced liquidation rather than a broken investment thesis. He suggests that the metal has developed an unusual correlation with the S&P 500, essentially being caught in the gravitational pull of the AI trade. This trend is disconnected from actual fundamentals, signaling a potential exhaustion of the current market move for those with a longer time horizon.

While investors fret over Federal Reserve rate decisions, Boockvar maintains that current market anxiety is misplaced. He views recent rate hikes as minor adjustments rather than the start of a aggressive tightening cycle. He cautions against relying on the Fed to bail out the tech sector, noting that historical bear markets persisted even when the central bank lowered rates. With significant portions of retirement portfolios now tied to a narrow group of tech stocks, he advocates for a shift toward non-AI assets, specifically energy and consumer staples.

Central bank activity remains a critical support factor. The World Gold Council reports that central banks purchased 321 tonnes in the third quarter, the fastest pace since 2024, signaling that major institutions are leveraging price dips to bolster reserves. As real interest rates begin to rollover and the U.S. dollar faces potential pressure from shifting foreign investment, Boockvar believes gold will eventually reassert its independence from the volatile tech trade.