By Melissa Pistilli-Exclusive to Silver Investing News

The price of silver closed at $10.16 in New York on Wednesday, touching a high of $10.57 in early morning trade Thursday.

A weaker dollar and gains in commodity prices helped to stir speculation that future inflation may be on the cards. The surge in price has recharged the bullish sentiment of many analysts.

Thursday morning, the U.S. dollar slid further from Wednesday’s low against a basket of six major currencies and the Reuters/Jefferies CRB Index of 19 raw materials jumped 3.2 percent Wednesday.

“People are getting more concerned about inflation down the road,” said Matt Zeman, a LaSalle Futures Group metals trader. “If the government keeps on spending and interest rates rermain low, it’s going to come back and bite us.” A plunging dollar will likely ignite a run on precious metals like gold and silver.

 Silver mining stocks enjoyed a boost on Wednesday, including Pan American Silver [NASDAQ: PAAS] jumped $1.99 to $13.21, Silver Standard [NASDAQ: SSRI] rose $1.33 to $10.38, Silver Wheaton [NYSE: SLW] climbed 55 cents to $4.14, Hecla Mining [NYSE: HL] rose 29 cents at $2.32, and Coeur d’Alene Mines [NYSE: CDE] traded up 10 cents to $0.70.

 Bullish sentiments return

Breaking past $11.00/oz has proved tough for silver in the past several weeks. “The silver price has been wrestling with its 50 DMA (day moving average),” said Franklin Sanders of The Money Changer. But, Wednesday silver managed to break through and close up 35 cents. “The real target here,” Sanders said, “is $10.50, the fence that has held in the silver price so long. Once that fence gives, silver will boogie.”  

Silver stepped up over that fence Thursday. We have yet to see silver put on its “boogie shoes” but perhaps the big day is not that far off.  While some analysts are rather meek in their estimation of silver’s potential, like Altavista Worldwide Trading’s Tom Hartmann who yesterday admitted that “silver is perhaps undervalued”, others such as Chris Vermeulen (TheGoldandOilGuy.com), and analysts at brokerages ScotiaMocatta and HCS Worldwide are much more bullish in their silver sentiments.

 ”Silver in my opinion could be the next really big winner,” said Vermeulen. Although he believes gold and oil prices will rise much higher in the future, they won’t put up the “type of returns silver could yield us.”

 In its December, Metals Matters report ScotiaMocatta advised, “Investors remain key to silver’s fate, but its monetary attributes should keep investment demand strong.” The metals broker believes that both gold and silver have great upside potential if the current weakening of the financial system continues.

 ”At present, ongoing deleveraging is dragging silver prices lower than other commodities,” the report explained. “But once that has run its course, then without that selling pressure, prices may well head higher again.” Analysts at ScotiaMocatta believe that silver likely may return to the $11/0z to $13/oz ranges in the months ahead.

 HCS Worldwide analysts also feel that great potential exists for silver price increases in the months and years ahead. Despite silver’s landslide from its high of $21 this spring, the brokerage has said that silver is likely to recover in the medium to long term.

 Like ScotiaMocatta, HCS sees commodities and equities deleveraging ending in the weeks ahead and the dollar weakening further, leading to marked increases in precious metals prices. HCS Worldwide has advised its clients to buy silver on pullbacks and recommends acquiring shares in silver miners.

 ECU Silver Mining Inc.

ECU Silver Mining Inc. [TSX: ECU] announced on Wednesday the results of its most recent NI 43-101 compliant mineral resource estimate on its Velardena District Properties. The results on the properties, located in historically silver-rich region of Durango, Mexico, confirm an increase in measured and indicated resources of 6 percent to 40 million ounces of silver equivalent and an inferred resource increase of 118 percent to 391 million ounces.

 ”Exploration efforts at Velardena have consistently yielded excellent results with several veins still open laterally and at depth,” said ECU President Stephen Altmann. “It is worthwhile to note that about 66% of our mineral inventory is comprised of precious metals. The high content of both gold and silver highlights the significance of this resource as a primary precious metal project.”

In light of the report, the company remains confident that substantial potential to increase mineral resources on the Velardena Properties exists.

 Shares of ECU Silver were trading at $1.01 Thursday morning, up three cents from Wednesday’s close.