Today, I sat down with Michael Oliver, founder of Momentum Structural Analysis, to discuss what his analysis is telling him about precious metals and the wider financial markets.
Despite the sharp correction earlier this year, Michael believes the underlying structure of gold and silver has remained remarkably resilient. Rather than signalling the end of the advance, he argues that recent price action may have laid the foundations for the next move higher.
And he expects that move to look very different from the last.
Michael believes gold and silver are entering a new phase that could prove considerably more explosive, driven not simply by short-term market headlines but by something much larger: mounting pressure in global debt markets and the continued degradation of fiat currencies.
The conversation extends beyond precious metals to the US stock market, government bonds, the Japanese yen and the vulnerabilities Michael believes are building beneath seemingly resilient markets.
Market Update
Gold and silver prices have continued to move higher, supported by a weaker US dollar and expectations surrounding the Federal Reserve’s September interest rate decision. With US inflation (CPI) data due tomorrow, Wednesday, and oil prices continuing to rise, we could see increased market volatility over the remainder of the week.
Following gold’s recent breakout, the next key level to watch is $4,430. This area marked the March lows and is now acting as an important resistance zone. A sustained break above $4,430 could open the way for a move towards $4,500, with a longer-term target around $4,900. On the downside, support comes in around the $4,100 level.
Silver is also approaching an important resistance level at $64. A break above this level would strengthen the recent move higher and bring the key $70–$72 resistance zone into focus.
Overall, the short-term outlook for gold and silver remains positive, but both metals will need to break through their key resistance levels to build further momentum and open the way for additional gains.
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