Analyst: Dollar and gold may have entered concurrent bull market

Since 2008, the United States has experienced historically unprecedented programs to spur the economy. There was quantitative-easing program one (QE1), QE2, Operation Twist, and QE3, which made available significant amounts of credit for the banks to loan out to the public. During that time, it was generally thought that this intervention had murdered the greenback, so investors hurried to buy gold in order to protect themselves from the dollar's fall. However, MarketWatch's columnist claims it is not true.

He brings under light the fact that since the launch of those programs, the dollar has climbed 42% since its 2008 trough. In particular, since 2011, the rise has been 34%.

In Gilburt's opinion, the only way Fed can affect the dollar is flooding the market with actual printed banknotes. While the central bank may indeed begin this printing process as the U.S. Dollar Index exceeds the 110 region, it will only lead to a corrective pullback in the dollar (possibly deep), which can last for several years, says the analyst. After that, the greenback will continue its longer-term ascent.

What about gold?

Gilburt believes that the gold may enter the bull market concurrently with the dollar. He turns to the history to support this view.

In 2014, there was a simultaneous rise in the dollar and the metals, rather weighty one. From November of 2014 through January of 2015, gold rose significantly, climbing 15% during that period. Meanwhile, the dollar jumped alongside of gold, climbing 9% during that same period of time.

Financial markets might be entering a new paradigm, and the inter-market analysis of old will probably have many on the wrong side of the markets, says the analyst. Looking closely at what reaction markets have over the last several years is essential, as it may mean we are entering a new paradigm financial markets stick to.