This graph gives some insight into gold’s most recent rally towards $1000.

The top panel shows the price of gold in USD, and the bottom panel shows the 26 week rate of change of gold holdings in global ETFs.

It is clear that since the height of the financial chaos last year, there has been a huge move into gold ETFs. This demand has played a large part in sustaining gold’s outperformance compared to other assets over this time. However, it also looks like this strong demand may be peaking. If the recent support from money moving into ETFs wanes, gold may have trouble holding on to its recent gains.