Given the bullish mania on Wall Street, it's hard for investors to look beyond the narrow breadth, low-volume rise pushing the Dow to incremental new daily highs. But slowly, under the surface, there are signs that insiders are pulling back and looking for alternatives.

Consider how emerging market stocks, which tend to act as a leading indicator for U.S. issues, have been sliding lower since January. Or the way industrial metals have been under pressure. Or the way that gold and silver, after being neglected since September, are starting to creep higher.

With inflationary pressures on the rise again and the dollar set to weaken after a two-month surge, the stars are aligned for a rebound in the precious metals -- just as investor sentiment plumbs new depths. Here's why.

Precious metals can move according to multiple catalysts. They respond to financial and political turmoil. They respond to the vagaries of the U.S. dollar, since they are viewed as an alternative store of value. And they are also seen as an important hedge against inflationary pressures.

Over the last few months, all three of these risks receded. Which is why investors have abandoned silver and gold en masse. As shown in the chart below, courtesy of Jason Geopfert at SentimenTrader, investor assets in the Rydex Precious Metals fund has plunged to lows seen near major turning points in 2008 and 2012. And on a relative basis, compared to assets in other Rydex funds, it's even worse.

Plus, those three catalysts I mentioned are poised to turn in gold's favor.

Contentious elections in Italy have created as power vacuum in Rome that will likely require fresh elections -- strengthening the cause of anti-austerity, anti-Eurozone politicians. Along with backsliding on deficit reduction efforts by the likes of Spain and France, the eurozone debt crisis is poised for another flare up.

Another political risk is the upcoming budget battle in Washington, which will be just the latest round in the knock-down fight over taxes and spending cuts between Republicans and Democrats. We have the debt ceiling in May and the specter of a government shutdown later this month.

Inflation, as reported in this morning's Consumer Price Index report, is starting to creep higher on a combination of elevated gas prices, falling labor productivity, and higher housing prices (pushing up rents).

With the Fed maintaining its "all-in" monetary policy stance -- and in the process, pushing inflation-adjusted interest rates deeper into negative territory on a scale that makes the run-up to the great inflation of the 1970s look like child's play -- prices are set to drift even higher.

This, in turn, will weaken the dollar. The DB U.S. Dollar Bullish Fund (UUP) fell out of its two-month uptrend pattern today partially for this reason. Whether or not the decline continues depends on how bad the situation in Europe gets.

But even if the dollar stabilizes, the lift from inflation and a return of a modicum of fear to this manic market should reignite the love affair with gold and silver -- and the related mining stocks -- after so many left them for dead.

I've already added both the Market Vectors Junior Gold Miners (GDXJ) and the leveraged VelocityShares 3x Daily Silver (USLV) to my Edge Letter Sample Portfolio to take advantage.

Disclosure: Anthony has recommended both USLV and GDXJ to his clients.

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