The chart that you provided actually shows that gold is often a strong investment in an inflationary environment. Notice the price action in the 1970s. Artemis Capital's Dragon Portfolio [1] idea explains the concept well. From my understanding the best explanation of gold's general behavior is real interest rates [2].
[1] https://artemiscm.docsend.com/view/taygkbn
[2] https://en.m.wikipedia.org/wiki/Real_interest_rate
