NEW YORK (TheStreet) -- After the quick rise in gold and silver prices, is it time to buy, or wait for a pullback? TheStreet's Joe Deaux asked Rick Rule, chairman of Sprott USA.

Rule said silver in particular has had a rather strong week. While he still finds the fundamentals favorable, he attributed most of the move to the metal's deeply oversold condition.

Silver, which often outperforms gold to both the upside and the downside, is up 17% for the month of August.

Rule added that it is seems as if we've had a large rotation in the two metals, where weak hands in the paper and futures market were shaken out of their positions and long-term, non-margin buyers were taking in physical gold.

Physical demand remains elevated, as seen by India's inability to stem demand despite raising taxes on purchases of the precious metals, Rule said. The metals are being bought outside of regulator control and consumers have also shown they are willing to pay the heightened taxes.

Although traders might find precious metal prices too high to chase, long-term investors still have favorable entry points, he said. Rule concluded that he remained a buyer and that gold is solid portfolio insurance. Platinum and palladium also have the most favorable supply and demand fundamentals of the entire group.

-- Written by Bret Kenwell in Petoskey, Mich.

Bret Kenwell currently writes, blogs and also contributes to Robert Weinstein's Weekly Options Newsletter. Focuses on short-to-intermediate-term trading opportunities that can be exposed via options. He prefers to use debit trades on momentum setups and credit trades on support/resistance setups. He also focuses on building long-term wealth by searching for consistent, quality dividend paying companies and long-term growth companies. He considers himself the surfer, not the wave, in relation to the market and himself. He has no allegiance to either the bull side or the bear side.

More from Gold

Gold to Skyrocket as Italian Rebellion Unfolds

Gold to Skyrocket as Italian Rebellion Unfolds

2010-Style Crisis Approaches: Prepare For Flight To Safety

2010-Style Crisis Approaches: Prepare For Flight To Safety

Gold Prices Look 'Rich' at Current Levels - Here's What Could Change That

Gold Prices Look 'Rich' at Current Levels - Here's What Could Change That

Watch This If You're Wondering How Much Gold to Have and When to Sell

Watch This If You're Wondering How Much Gold to Have and When to Sell

How Can Gold Continue This Upward Momentum?

How Can Gold Continue This Upward Momentum?