Despite of recent spike in the price of gold and silver, gold indices continue to under perform, see recent Gold Indices Review.
I wish to share with you an advertisement I saw at yahoo finance HUI page:
This more then all is a symbol for the current market sentiment, everyone seems to be bullish about gold lately, gold being a popular topic for main stream investing blogs, The extreme bullish sentiment implies extreme caution, I do not recommend initiating any new gold or silver positions at this time. Ride your existing positions and take profit according to your trading style and time frame.
Mitsui Global Precious Metals, Haliburton Mineral Services and Virtual Metals Research & Consulting published the global gold hedge book report. Q4 2006 Hedge Impact declines 1.5 million ounces to 40.2 million ounces. Total dehedging for 2006 was 13.4 million ounces. See the full report here