Michael Oliver, CEO and founder of Momentum Structural Analysis, joins me to share how he sees the technical momentum setup in gold, silver, US general equities, precious metals stocks via the XAU index, the US dollar, bonds / interest rates, and commodities.

We start off getting his technical outlook on gold and silver; where Michael postulates that when the US general equities really start to roll over, that a portion of investors will rotate funds into gold, silver, and the PM equities.  In addition to remaining constructive on gold, where dips should be bought, Michael points out that the setup in silver and the precious metals equities are setting up to make a bigger breakout versus gold, and he is also keeping a close eye on the gold to silver ratio.

We then shifted over to the nuances and difference in what the pricing chart in the S&P 500 or Nasdaq was showing versus the picture shaping up in them momentum framework. Michael is anticipating a correction and cooling off in US general equities, but notes it doesn’t need to be a sudden crash, but really more of a protracted bear market in US equities.  Despite this future bearish backdrop for US equities, he still sees the pathway forward where gold and silver equities can attract a bid, from money rotating out of stocks into the precious metals complex overall due to rising underlying metals prices. He points to periods of times in late 1970s where we had a similar setup of market forces, and points out the XAU index has been both outperforming the US equities and even Gold for some time, even if GDX hasn’t quite performed as well.

We then move into his analysis of the US dollar and trends in interest rates and bonds.  He points to the potential to see bonds get a short to medium term bid along with gold as safe havens outside of the general equities, for investors want to diversify some exposure into these asset classes, but that longer-term he still remains bearish on the larger pattern playing out in bonds.

Wrapping up we take a look at the commodities sector through the lens of the Bloomberg commodities index, noting the commodities haven’t tracked with gold thus far, but that may about to be ready to change where commodities pick up some of the money rotation bid as well. In particular, Michael is constructive on the soft commodities and grains complex, as well as fertilizers, farmland, and related agricultural sectors.  He believes that a second major leg higher in commodities complex is setting up.

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