Gold and Silver Price Bubble will Burst in Summer 2011
As negative sentiment towards US dollar increases, both gold and silver are currently experiencing a bubble. Gold futures trading above 1500 US$ per ounce and Silver Futures trading well above 45 in late April must burst with panic buying and short covering in US dollar.
The exchanged traded fund GLD gained close 10% from year to date and gained 32% in the last one year. The exchange traded fund SLV increased by 55.33% from year to date and it is increased by 156.74% in the last one year. Increasing the media hype and fear of US inflation along with hedge fund buying commodities knocking out novice investors short position created this commodity bubble.
How fast Gold and Silver prices went up, when it collapses it would be much faster and a sudden debacle. It is dangerous to hold gold and silver based on fundamentals.
The reason why the commodity prices are driving up is just because of market manipulation and greediness from hedge fund and amateur investors. The recent upward movement on silver prices and volume of trading making me to think that price collapse on silver and gold are imminent.