No market moves in isolation. Bonds, the dollar, commodities and stocks are connected through interest rates, inflation and growth. Intermarket analysis uses those connections to confirm what one market is telling you, or to warn you when something doesn't add up.
| Relationship | Usual direction | Why |
|---|---|---|
| Dollar vs commodities | Opposite | Commodities are priced in dollars |
| Dollar vs gold | Opposite | Same reason, plus gold as an alternative currency |
| Real yields vs gold | Opposite | Gold pays no yield |
| Yields vs stocks (especially tech) | Often opposite | Higher discount rates lower the value of future earnings |
| Oil vs inflation expectations and yields | Together | Energy feeds directly into inflation |
| Yield differentials vs currency pairs | Together | Money follows higher returns |
Using it in practice
- Confirmation: a long gold idea is stronger if the dollar and real yields are falling.
- Warning: if Nasdaq rallies while yields surge, the rally may be fragile.
- Leading signals: bond yields often move before currencies and stocks react.
When relationships break
Correlations shift with the economic regime. In some periods stocks and bonds fall together (for example when inflation is the market's main fear); in others they move opposite. Treat these links as context you check, not rules you rely on.
Key takeaways
- Bonds, the dollar, commodities and stocks are linked through rates, inflation and growth.
- A stronger dollar and higher real yields usually weigh on gold and commodities.
- Rising yields often pressure stocks, especially tech; oil feeds inflation and yields.
- Use intermarket links for confirmation and warnings, and expect them to shift between regimes.