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Is this bad news or good news for the markets?

Some market watchers are unhappy with a volatile market, as gold investors rejoice. The precious metal has surged in the face of investors who are in a flight to safety.

"Every time something goes bad, it's good for gold. Every time something goes good, it's bad for gold," Dan Denbow, assistant vice president at USAA Investments and manager of the USAA Precious Metals and Minerals Fund, said Tuesday on CNBC's "Power Lunch."

Gold futures settled up 1 percent to $1,222.60 an ounce on Tuesday.

Bad news may be on the horizon for gold, however, as the Dow transports are depicting bullish signs, according to a strategist.

Dow transports leading the industrials put into motion the Dow Theory concept, Gene Peroni, senior vice president at Advisors Asset Management, told CNBC's "Power Lunch." on Tuesday.

Last week the Dow Jones industrial average saw its best week for the year, but closed down 1.1 percent Tuesday.

The Dow transports, which closed above their 50-day moving average for the first time since December last week, dropped 1.3 percent on Tuesday.

"This wouldn't be all that meaningful alone, but it's occurring as the commodities are beginning to show really good signs of bottoming and starting to rebound here," Peroni added.

He may be confident that commodities are reaching a bottom, but a slide in oil prices helped to spook U.S. markets Tuesday, as the major averages fell more than 1 percent each. U.S. crude settled more than 4 percent lower after Saudi Oil Minister Ali Al-Naimi ruled out any production cuts.

"Today is all about oil and I think we're going to continue to see this in lockstep," Empire Executions President Peter Costa told CNBC's "Closing Bell" on Tuesday.

But attributing stock performance to oil market fluctuations, or the other way around, may not prove accurate, said Erik Ristuben, chief investment strategist at Russell Investments. He said recession fears have driven volatility in both equities and energy this year.

Ristuben believes a recession is unlikely, and he contended that markets will begin to trade on fundamentals once fears of a slowdown dissipate.

"We don't think there's going to be a recession and we think it's likely that when the market kind of gets comfortable with that idea, you're going to see stocks trade on fundamentals and energy trade on fundamentals. And oil fundamentals do not look good," he told CNBC's "Closing Bell" on Tuesday.

In any event, Denbow makes the case for investing in gold. He contends that the gold mining companies have operating leverage, something unusual in the past four years. Denbow does acknowledge, however, that gold investors would benefit from a flat price.

"If gold just stays flat, my guys can start making money, generate free cash flow and start returning some of that to shareholders," he said. "We would all like higher gold price? Yes. Will the rest of your portfolio like it? Probably not."

— CNBC's Evelyn Cheng contributed to this report.

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