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Gold peaked during the last two periods when inflation hit its lowest point, rather than when inflation was increasing.
Patrick Karim, technical analyst at Technical Traders Ltd, added that gold has recently rallied at a time when inflation was declining. Karim argued that buying gold and silver during periods when inflation breaks down has produced better results than buying when inflation is accelerating.
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Karim has previously noted that gold has struggled to outperform stock markets, suggesting it may need more time to break out in his earlier analysis. In a separate report, he identified four economic signals that he viewed as warning signs for a turning point in the U.S. business cycle, as detailed in recent commentary. These observations provide context for his current views on gold's performance during changing inflation trends.