Gold breakout above $1600, silver above $28 - is it sustainable this time around?

It is probably a fool's game to try and predict short term movement in precious metals prices - particularly in the much more volatile silver sector where the small market size makes it particularly prone to manipulation by vested interests up or down. But with gold there does certainly seem to be resistance to downside falls below $1550 and an underlying propensity to reach higher levels again. It is notable, for example, how well investment in the top SPDR gold ETF has held up through a disappointing period for the yellow metal which is a strong indication that the big North American money is looking more and more for a rise in price in the months ahead. Indeed investment also appears to have been pouring in to some of the other significant gold ETFs too, notably in Europe, as those increasingly worried about the European financial sector move their capital into traditional safe havens....

While all eyes may be on the U.S. , Europe is already seeing more Quantitative Easing expanding monetary supply in this key area and the sovereign debt situation here looking to run and run and prospective bailout funds still insignificant in relation to Spain and Italy's huge debts alone. ...

China is also expected to add more stimulus to its massive economy, where growth is still slipping....

                                          ................. Lawrence Williams