Short and Long Term Bullish News for Precious Metals

Up more than 4% today on the announcement that Quantitative Easing III will continue unabated, the exchange traded funds for gold (GLD) and silver (SLV) received additional pieces of good for companies such as Barrick Gold (ABX) and Wishbone Gold PLC (WISHY).

An article in Barron's was very positive for Barrick Gold, moving the stock higher. The article posited that Barrick Gold could soon be the target of activist investors. In the Barron's article, a research firm stated that Barrick Gold was worth $44 a share when it was trading at under $20.

Barrick Gold was recently recommended by UBS and soared double digits on the Federal Reserve news.

Wishbone Gold PLC was recently recommended by Beaufort Securities. It has substantial holdings in the Queensland Terriorty of Australia, which positions it well for the Chinese and Indian markets. India is the largest buyer of gold in the world, with China close behind.

Last September, gold and silver rose after Federal Reserve Chairman Ben Bernanke introduced Quantitative Easing III. This time the positive impact on the price of gold and silver assets should endure. The United States Dollar (USD) has fallen sharply in recent market action.

Those trends were reversed late last year as the amount of capital produced by quantitative easing in the United States and Japan overwhelmed the positions of traders. There were great losses in gold, silver, and foreign currency positions for many investors and speculators.
But, as detailed in Barron's, the activist investor community is now circling precious metal assets. That can only be bullish for Barrick Gold, Wishbone Gold, the GLD, the SLV, and other precious metal assets. With the Dow Jones Industrial Average (NYSE: DIA), the precious metals sector is particularly appealing for activist investors.

With Bernanke's de factor admission that the US economy is still weak, there should be additional movement to gold, silver, other commodities. Copper (NYSE: JJC) should not do well as it needs industrial consumption to rise, but gold and silver should rise again based on the historic role of each as a safe haven asset.