The iShares Silver Trust (NYSEArca: SLV) and ETFS Physical Silver Shares (NYSEArca: SIVR), which are backed by physical silver bullion, jumped on Monday, adding to modest year-to-date gains. Some market observers believe that as the U.S. dollar continues struggling, silver and the aforementioned exchange traded funds offer more upside.

The PowerShares DB U.S. Dollar Index Bullish Fund (NYSEArca: UUP), the tracking exchange traded fund for the U.S. Dollar Index, is one of the worst-performing currency exchange traded funds this year. UUP is lower by almost 9% year-to-date. Silver and other commodities are denominated in U.S. dollars, meaning weaker greenback is often supportive of upside for commodities prices.

“Silver is having to deal with the 200-day moving average. Once we can take out the 200-day, next stop is $17.50. It seems like so long ago that we have seen that price. In fact, it was June 6 when the white metal closed at $17.70. Could we get to that level by the end of the week? Seeing as we have been “consolidating” with silver just like with gold, we will have a move, and if we set our sights on an up-week, we would be putting in another round of higher-highs, and then the technical traders would want to get in on the action, further adding to the move up,” according to ETF Daily News.

Silver could get another boost if gold prices start rebounding in earnest. Indian demand is vital for gold because the country is the second-largest buyer of the yellow metal behind China. India, one of the world’s largest gold consumers, could be set to lower its import tax on bullion, which could be major catalyst for gold prices.

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