Gold and silver prices and exchange traded funds (ETFs) soared into the stratosphere last year before pausing for breath. Watchers of the metals are now wondering: are there more price spikes in the offing or does the pause signify a rally that’s run out of steam?

Analysts are sharply divided these days: on one side are the dollar bulls who think the dollar will strengthen and gold will weaken; on the other side are the dollar bears, who think gold is only warming up. Willfred J. Hahn for Index Universe questions those who believe gold’s price is set to soar again and has a few points to make about the current market:

  • Gold prices have been rising because currencies the world over are mostly in a weakening phase and governments are printing money fast and furiously.
  • The current gold rush is at best, already over. If everybody is talking about it, it may be finished. And the timing of jumping onto the golden bandwagon presents itself at an expensive price.[Regulators and Precious Metals.]
  • The previous “gold rush” that occurred between 1980 and 1982 took  the price of an ounce of gold then to above $800 from a level of less than $100. Emotional buying and the herd mentality never pays off, and eventually gold came back to around $260 levels. If you own gold, it’s a store of wealth but you can’t live on income generated from the metals.
  • The bottom line is that you should watch the financial trends and the 200-day moving average for your answer to the golden question. Look at trends in other commodities, too. There are plenty of them out there and you may not be buying at a premium. [What to Know About Commodities.]

Experts are predicting that gold investment this year is going to soar, thanks to another year full of potential financial uncertainties, says Marketwire. [How Precious Metal ETFs Have Changed Investing.]

Alix Steel for The Street spoke with Mike Maloney, the author of Rich Dad’s Guide to Investing in Gold and Silver, who believes that silver prices could not only hit quadruple digits, but it could outperform gold in the long run. Whatever silver actually does, Maloney says silver should perform alongside gold.

For more stories about commodity ETFs, visit our commodity ETF category.

  • ETFS Physical Gold Shares (NYSEArca: SGOL)
  • PowerShares DB Gold (NYSEArca: DGL)
  • SPDR Gold Shares (NYSEArca: GLD)
  • iShares COMEX Gold Trust (NYSEArca: IAU)
  • PowerShares DB Silver (NYSEArca: DBS)
  • iShares Silver Trust (NYSEArca: SLV)
  • ETFS Physical Silver (NYSEArca: SIVR)

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.