Chris Vermeullen March 2022
With the gold price well above US$2,000 per ounce at times this week, precious metals investors have had their eyes on the yellow metal — but it’s not the only commodity making moves.
Speaking to the Investing News Network, Chris Vermeulen, chief market strategist at TheTechnicalTraders.com, shared a technical perspective on gold’s activity, as well as what’s going on in the resource space as a whole.
He said that similar to 2001, when the stock market peaked and everyone wanted stocks and real estate (until the bubble popped and commodities rallied), the world is making a major shift toward commodities.
“We’re in this phase where I think we’re going to see a three to five year commodity shift where they’re going to have huge value growth, and they’re going to defy I think the stock market in a bunch of ways,” Vermeulen said.
He has a positive outlook on commodities as a whole, but said gold and silver in particular look primed to move.
“I think gold, silver and miners are just coming into sequence here where they’re about to start their great big run. So to me they’re kind of the locked-and-loaded commodities, ready to pop and run,” he explained during the interview. “Gold and gold miners have started that, but we haven’t really seen the break to new highs just yet. I think that’s coming, so that’s the pocket I’m most excited about.”
That said, Vermeulen emphasized that volatility is high right now, and after this week’s moves a short-term period of cooler prices may be in store for commodities like gold and silver.
“I have a feeling the stock market could have one final big drop, another 5 or 8 percent drop, and that will pop the VIX (INDEXCBOE:VIX), the volatility, up. That’s going to create a lot of haywire in precious metals, and pretty much across the board in everything,” he said, noting that such a breakdown could create widespread panic selling.
“Just know that if the stock market starts to hit some new multi-month lows here it might actually put some pressure on commodities for a week or three as that panic works itself through the financial markets,” he said.
Watch the interview above for more of Vermeulen’s thoughts on the commodities space.
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Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.