Bullish Bullion: Gold to gain 10%, Silver 20%

The multi-faceted yellow metal gold had a hard time during the wake of the worst recession since the Second World War as an untimely rise in US dollar eclipsed the safety haven appeal of the metal. Gold was also caught up in the imbroglio where panic selling engulfed the market. The metal usually shares an inverse relationship with US dollar as it is considered an alternative investment to the currency.

However, the metal benefited from m the subsequent dip in the economical cycle, which pummeled the US currency, driving investors towards the safety of gold. The metal, since then, went o on to explore new heights with investment and safety buying piling up, lending the metal with wings to rise.

Economies through out the world introduced stimulus packages and bailouts in their r desperate efforts to resist inflation and rekindle growth. These financial inducements seem to be bearing fruit with economic data releases slowly creeping into positive territory. Favorable economic c conditions have once again put US dollar in the lime light with the culmination of the year 2009, in turn weighing on prices of gold.

Prices well supported by rising physical and investment demand
Gold prices, during February 2010,, hit its lowest level since the month of November 2009 as technical selling that emerged following a stronger US dollar and Macro Economic concerns that threatened the European nations and its currency put pressure on the market.

However, prices of gold have held up well at supports after falling almost 15 percent from the all time high of $1226.

Emergence of significant physical d demand at lows has helped the metal keep most of its gains from the Bull Run that commenced during the beginning of the 21st century. Investment demand of the metal has also been supporting prices.

Physical demand from the major importers like India and Turkey has been encouraging. According to the Bombay Bullion Association imports of India during the month of March 2010 has jumped towards 23-28 tonnes as compared to 4.8 tonnes during the same time last year. Higher imports of gold from India are attributed to the wedding season in the country, which begins in the month of April 2010. more...