Silver settled down by -0.34% at 54757 dropped down from the day's high of 55175 dropped after the strong US retail sales report boosted optimism about the US economy and after prices failed for a second time to surpass $29.45 an ounce, prompting investors to reduce bullion positions. Still outlook remain firm for this week as support seen after the report that the Germany's central bank expressed there concerns about the euro zone crisis and the risk of the ECB's moves to stem the crisis. The metal rose near to $29.35 on hopes that the ECB will extend its loose monetary policy following euro zone industrial output data showing a surprisingly big fall in January. The dollar index's seven-month high and gains in US equities also weighed on gold's safe-haven appeal. Late in the day, the Wall Street Journal, citing people familiar with the situation, said the top US derivatives regulator began internal discussions on whether to investigate the daily fixing of gold and silver prices in London for possible manipulation. Meanwhile the next major economic reading comes on Friday with US consumer inflation data. With only a small rise forecast for the February gauge, analysts said there may be little reaction to the report. Investors will also be anticipating any word from officials at next week's US central bank policy meeting. Now technically market is getting support at 54500 and below could see a test of 54242 level, And resistance is now likely to be seen at 55095, a move above could see prices testing 55432.

Trading Ideas:

Silver trading range for the day is 54242-55432.

Silver dropped after U.S. retail sales beat expectations while European output figures disappointed, supported dollar

Combined good news out of the U.S. and disappointing news out of Europe pushed prices lower.

Italy’s Treasury sold EUR3.32 billion worth of three-year government bonds at an average yield of 2.48%.