Silver was the top price performer in the precious metals sector this past Friday, surging ahead 1.5% to close at $27.32 an ounce. After some pullback in the morning Monday, Silver posted further gains to close at $27.87 an ounce. Today, during the morning hours, Silver receded to a low of $27.18 even after news that North and South Korea had exchanged artillery fire pushed Gold prices up near $1380 an ounce. A strengthening US dollar may have suppressed gold’s gains and placed downward pressure on Silver as well. Recent EUR weakness, in light of ongoing financial woes in the EU, is adding to sentiment for the possible demise of the currency, which would prompt a stampede of cash into the greenback. Silver traders should be keeping their eyes on news coming from Europe. Any flight from the region’s assets will likely end up in the US dollar, putting downward pressure on precious metals, oil, and other commodities. Moreover, any increase in interest rates in China could also suppress demand for precious metals. As we head into the holiday shopping season, precious metals like Gold and Silver should find added support. Claims for $30 Silver have been posited, and expectations for an impending cyclical downturn in both Gold and Silver has been documented by me previously; but taking place, most likely, after 1 January 2011.

Source