By Melissa Pistilli-Exclusive to Silver Investing News

Silver is on a roll. This week the precious metal has soared past a more than five-month high reaching upwards of $14.35 Wednesday morning. Analysts have said if the price can breach $13.88 (which it has and then some), then we could very well see the silver price at $16.50 in the medium term. The next key resistance to watch is $14.70. However, be aware that the silver market is a volatile one and a slide down is quite possible. But the general trend, according to Crown Forex, is to the upside as long as support at $12.00 remains steady.

Gold and silver are both benefitting from a sense of trepidation in the markets as speculation swirls over the possible dangers of almost nonexistent interest rates and over-the-top government spending. In the U.S. and Japan, interest rates are nearly zero and the Bank of England recently cut its rate to 1 per cent. “Up the road, you’re looking at governments devaluing their currencies to pay for the financial crisis. It’s the ultimate flight to safety for gold,” said Frank McGhee, the head dealer at Integrated Brokerage Services LLC.

After a break for President’s Day, the markets tanked on Tuesday amidst concerns Obama’s $787 billion stimulus plan is too little too late. The Dow closed down almost 300 points (3.8 per cent). The S&P index lost 4 per cent at the opening bell and by the end of the trading day had lost 4.6 per cent.

Markets in Asia and Europe fared no better as worries over bank stability cast a dark shadow. Moody’s credit ratings agency has released a cautionary report that failing economies in Eastern Europe, where bank shares plunged to six-year lows, will negatively impact banks in Austria, Belgium, France, Germany, Italy and Sweden. Already, banks around the globe have experienced close to $1.1 trillion in writedowns and credit losses over the fallout from the U.S. subprime-mortgage market debacle.

Fear over the uncertainty in the markets and the global economy is pushing many investors into the safety of precious metals, said Peter Fertig, owner of Quantitative Commodity Research Ltd.

While gold is faring unsurprisingly well in this climate, it is silver stocks that are ranking as the top equity performers. Silver equities had risen nearly 5 per cent by Tuesday afternoon, to end the day with close to 3 per cent gains. “Silver stocks, which command a combined global market value (capitalisation) of $13 billion, currently rank as the best performing equity sub-sector in the world, led by stellar performances from  Silver Standard, Fresnillo, and First Majestic,” wrote Barry Sergeant of Mineweb.

Silver producers like those Sergeant mentioned are indeed benefitting and will continue to do so, according to Clif Droke of Gold Strategies Review, because they have the “upside price momentum as well as internal momentum. This is a rare breed among stocks of any major sector right now.”

First Majestic Silver Corp.

First Majestic Silver [TSX.V: FR] recently announced a new NI 43-101 Reserve/Resource update on its La Parilla Silver Mine in Durango, Mexico. The total reserves/resources for the property has risen nearly 20 per cent to 88.75 million equivalent ounces of silver: 5.25 million oz. Proven and Probable; 30.70 million oz. Measured and Indicated; and 52.80 million oz. Inferred.

The company has three mines in operation on the La Parrilla property: the La Rosa/Rosario/La Blanca systems, San Marcos, and Quebradillas. A cyanidation and flotation ore processing plant with a capacity of 840 tpd is also on the property.

So far, all the exploration, development and mining on the property has been centered on a small portion of the over 53,000 hectares of the property. Currently, exploration and development work is taking place on several areas besides the aforementioned mines including development of the Las Vacas mine, which First Majestic expects to be in production by 2010.

As of Wednesday morning PST time, shares of First Majestic were trading at $2.86, down from a 52-week high of $5.75.

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