Rebase of #503

[dprotaso]

This is a rebase of https://github.com/argoproj/gitops-engine/pull/503

Fixes: https://github.com/argoproj/gitops-engine/issues/501

[sonarqubecloud[bot]]

Quality Gate passed

Issues
1 New issue
0 Accepted issues

Measures
0 Security Hotspots
0.0% Coverage on New Code
0.0% Duplication on New Code

See analysis details on SonarQube Cloud

[codecov[bot]]

Codecov Report

:x: Patch coverage is 0% with 7 lines in your changes missing coverage. Please review. :white_check_mark: Project coverage is 46.97%. Comparing base (8849c3f) to head (2ea0542). :warning: Report is 57 commits behind head on master.

Files with missing lines	Patch %	Lines
pkg/cache/references.go	0.00%	6 Missing and 1 partial :warning:

Additional details and impacted files

@@            Coverage Diff             @@
##           master     #771      +/-   ##
==========================================
- Coverage   54.26%   46.97%   -7.30%     
==========================================
  Files          64       64              
  Lines        6164     6557     +393     
==========================================
- Hits         3345     3080     -265     
- Misses       2549     3220     +671     
+ Partials      270      257      -13     

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