Editor’s Note: Sluggish global growth has created a punishing bear market for most commodities over the last several years. But a few commodities—like gold—appear to be reversing trend. Today, we talk to former hedge fund manager Teeka Tiwari for his insight on how to navigate the rough commodity waters for maximum safety and profit…

J. Reeves, editor, The Palm Beach Daily: Big T, oil’s inching back up toward $40 a barrel. Some major U.S. shale oil producers say they’re profitable at that price.

Is the bottom in for oil?

Teeka Tiwari, editor, Mega Trends Investing: It’s not the real bottom until crude oil breaks its downtrend line. That means oil must close above $45 a barrel.

Here’s why that’s doubtful…

As you said, the U.S. shale oil industry is economical with $40 oil. So if oil climbs above $40, a slew of new supply will hit the market.

The oil glut will be back in full swing. And that means lower oil prices for a considerable time to come.

J.R.: Does that mean we’ll we see mass bankruptcies hitting the oil patch in 2016?

Teeka: Yes. They’re already here. We saw a 379% increase in energy company bankruptcies in 2015. The energy sector’s bond default rate for 2016 is at a six-year high… and it’s only March.

Fifty percent of junk bond defaults in Q4 2015 were energy related. The junk bond market is a mess. Expect more of that to come.

J.R.: The carnage means there will be extraordinary opportunity in oil. When will it be safe to pile back into this beaten-up sector?

Teeka: It’s not safe until we see a successful retest of the old lows in crude.

That means we first have to get close to—or lower than—the January 2016 lows of $26 per barrel.

Then, prices have to close higher—and continue higher—for at least three consecutive days. That will be a sign investors can wade back into energy stocks.

J.R.: Let’s talk about gold. Gold is 2016’s top-performing asset to date. It’s up 19%… as the S&P 500 struggles to break even.

You provided your Mega Trends subscribers a special “hedged” way to hold gold. Why would a gold buyer want to own gold in the way you recommend?

Teeka: Like my good friend Tom Dyson, I believe the U.S. dollar is going to outperform all other currencies.

That’s because America is the only major economy raising interest rates. That makes our currency very attractive to foreign buyers.

But the price of gold is quoted in U.S. dollars. So when the dollar goes up, the price of gold historically goes down… since it takes more foreign currency to buy the same amount of dollars.

As gold gets more expensive to foreign buyers, it can cause gold prices to drop or stagnate.

So if the greenback keeps rallying, Americans may lose money by buying gold.

Now, I still want to own gold as a form of insurance against financial chaos. I’d just like to not lose money paying for my insurance policy…

So I’ve recommended a “pairs trade” as a way for my readers to hedge their gold purchases. The trade is long gold and short the Japanese yen.

The yen has fallen 17% against the U.S. dollar since 2013. And it will continue to fall.

That’s because Japan has an “export economy.” It benefits from a weaker yen.

As the yen gets cheaper, so do Japanese exports. These cheaper products increase sales abroad, which benefit Japanese firms.

So Japan will continue to devalue the yen to boost Japanese exports.

We’re taking advantage of this—and using it to protect our gold purchases.

I can’t go into the details here, but I recommend all gold buyers do something similar.

J.R.: Okay, let’s talk about a commodity not on most folks’ radars: lithium. Some call lithium the “new gasoline” in a world of battery-powered cars like Tesla.

GE expects the “storable energy” sector to quadruple into a $6 billion-per-year industry in under four years. And lithium is rare. Nevada is the only U.S. state that produces it.

Do you see storable energy as a massive new mega trend in the works?

Teeka: Yes. All “power solutions”—like lithium—are high on my research list…

Inexpensive long-lasting batteries are the “holy grail” of tech right now. Everyone is looking for smaller, cheaper, and more powerful batteries.

I’m also looking at fuel cell technology. One company I met with at the Consumer Electronics Show (CES) created a fuel cell battery for the iPhone that can deliver 10 days of power.

Another company I’m researching created a sensor that harvests ambient light and radio waves to power itself.

Power solutions for the digital age is an area where life-changing wealth can be made. I’m excited to place my readers right in the thick of it.

J.R.: You’re doing more “boots on the ground” technology research today… at the South by Southwest conference (SXSW) in Austin, Texas.

What technologies are on your radar to explore there?

Teeka: Power solutions, new sensor technology, “long-range Wi-Fi technology” (or “Li-Fi,” 50 times faster than standard Wi-Fi), self-driving cars, virtual reality, and “internables” (wearables you either swallow or have surgically implanted).

For example, a British company is developing an “imaginary meal” pill. It secretes a chemical that tricks your stomach into feeling full.

These types of devices hold tremendous promise for widespread medical use… and tremendous investment upside.

J.R.: Outstanding. We look forward to an extraordinary conference “debrief” after you return. Thanks for your time, Teeka.

Teeka: Absolutely.