The traditional inverse relationship between gold and equities has fallen apart as prices of large-cap stocks and gold futures collapsed and rallied in tandem over the past three months.

One reason for the coupling is that lowered interest rates are simultaneously making stocks and gold look attractive relative to bonds, said Fawad Razaqzada, a market analyst with ThinkMarkets.

"Although gold is considered a safe haven asset, its negative correlation with the stock markets has broken down," Razaqzada said. "This is undoubtedly because of central banks' desire to depress yields, driving investors into equities while simultaneously boosting the appeal of the non-interest-bearing precious metal."

Gold futures settled at $1,738.40 per ounce on May 21, down 0.6% from May 20 but up nearly 18% from the most recent trough March 19. Similarly, the S&P 500 on May 21 closed at 2,848.51, down 0.78% from May 20, but up 27.3% from its recent trough, which occurred March 23. The Dow Jones Industrial Average closed May 21 at 24,474.12, down 0.41%, and the Nasdaq Composite Index closed at 9,284.88, down 0.97%.

Strength in equities has often corresponded with weakness in gold prices, and vice versa. For example, from late October 2016 to mid-December of that year, gold prices fell by 13% while the S&P 500 increased by 6%. A year earlier, gold prices fell about 10.7% from mid-October to late November as the S&P 500 increased by 4.1%.

But gold and equities crashed together in March amid a substantial increase in volatility and a "dash for cash" by investors, said Bart Melek, head of commodity strategy with TD Securities.

"Everybody was selling everything to, one, provide liquidity and, two, to provide cash for redemptions and to cover margin," Melek said. "Gold was sold along with everything else."

Melek called the current tandem moves coincidental, rather than causal, as unlimited quantitative easing has led to rallies in several markets that have countered fundamentals.

"Financial repression is generally a big topic for investors around the world, particularly in developed economies," analysts with UBS wrote in a May 20 note. "Ballooning government debt and central banks coming to the rescue to keep borrowing costs at historical lows give investors no choice but to take on more portfolio risks. This has kept investors' interest in real assets, like gold and silver, high."

Melek also tied gold's recent rally to a perception of risk in real interest rates, firming of the U.S. dollar and an uptick in rates along the yield curve.

"There are a lot of moving parts here," Melek said. "So long as the market believes that equities are as valued as they can be for now and we start seeing expectations later on as things normalize, gold should start looking better."