NEW YORK ( TheStreet ) -- Gold prices soared and silver prices continued to fall Friday as the U.S. jobs number surprised to the upside.

Gold for June delivery added $10.20 to settle at $1,491.60 at the Comex division of the New York Mercantile Exchange and has fallen 4.7% in a week. The gold price Friday has traded as high as $1,498.50 and as low as $1,471.10. The spot gold price was rising $11.30, according to Kitco's gold index.

Traders on the Comex were still evening out their positions into Friday's U.S. jobs report, but some bargain hunting did emerge and physical buyers came out of the woodwork buying up the metal at "discount" prices despite a stronger U.S. dollar.

Silver prices were still shaking out leveraged traders, down 95 cents, off session lows, to settle at $35.28 an ounce cratering 27% in one week. Silver has broken below multiple resistance levels from $38 to $36 and now is seeing if it can hold the $32 level. The iShares Silver Trust ( SLV) dropped another 118.34 tons Thursday bringing this week's grand total to 752.42 tons.

Gold prices are holding up better than silver, a rare divergence. "Gold up, silver down is a very rare event -- less than 14% of all trading days since 1968," says Adrian Ash, head of research at BullionVault.com. "Before this week it has happened only "two consecutive days ... 125 times and three consecutive days happening only once."

Ash also says that "gold fell harder than this in all of the last 10 springs except 2002, 2005 and 2007. Each of those drops then saw gold recover and breach its previous high by the next New Year, averaging a rise of 9.7%."
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The combination of overbought conditions, four margin hikes from the CME and other global clearing houses, and a recent parabolic move have zapped the "poor man's gold" harder than gold. The U.S. dollar index also staged a mini-rally this week, which sped up as European Central Bank President Jean-Claude Trichet appeared more dovish after the latest ECB meeting which dragged down the euro and propped up the dollar.

The U.S. dollar index was adding 0.8% to $74.71 Friday after rumors spread that Greece was considering leaving the EU and on the good jobs number. Investors speculated that the Federal Reserve might be more apt to raise rates or shrink its balance sheet if the employment picture keeps improving.

Nonfarm jobs rose 244,000 in April and the private sector added 268,000 reportedly the biggest month increase since 2006. The unemployment rate rose to 9%, most likely because more people, feeling better about the economy, entered the market. March private sector job growth was revised upwards as well.

"I think the precious metals are looking for QE3," says Bob Haber, CEO of Haber Trilix, and now "its extended out in time for that to happen if at all." A rising employment rate, Haber argues is good for the economy and is how a regular expansion would unfold as more people feel better about looking for jobs.

In terms of the recent selloff, Haber says "we are going through a forced liquidation," which is continuing in silver Friday as traders prepare for Monday's margin hike, but gold has stabilized.

Mihir Dange, trader at Arbitrage, says silver's selloff might be overdone and that he would much rather be long silver than short at these levels, but is cautious on both metals.

Ash says that silver doesn't move opposite from other commodities for long and could perhaps foreshadow a rally in the metal.

Pat Heller, general manager at Liberty Coin Service, an online bullion dealer, says he has seen a slowdown in silver and gold buying and selling this week. "I expect that some people who were contemplating a purchase of gold or silver will now be turned away from the idea because they are seeing how volatile the markets can be. This greater volatility is something I expect to continue into the indefinite future."

Heller points to a stronger trend in accumulation rather than selling and the dealer has had to keep purchasing the metals from wholesalers to fill orders. "Overall we are still swamped with customers."

Heller also cites shortage of physical silver in India as a strong demand factor for the beaten down metal. "It has been almost impossible to get immediate delivery of silver in India since the beginning of April."

Heller says that in the U.S. the Mint's primary distributors are no longer accepting order for Silver Eagle Dollars and that those who are are saying delivery won't happen for at least a month. It is unclear if this is due to strong demand or a delay in when miners and refiners and deliver the physical metal to the Mint.

Jon Nadler, senior analyst at Kitco.com, thinks that silver's bubble has burst and gold's balloon has deflated. He thinks that silver and gold could see bounces in the future but that silver's range will wind up being between $26 and $32, and that gold could target $1,030 to $1,040 on the low end.

One of Nadler's reasons for being relatively bearish on gold is that the gold stocks didn't confirm gold's rally last week when it hit an intraday high of $1,577 an ounce. The correlation between the two has been weak and stocks have not been providing the leverage of old as traders and investors have a wider variety of gold products to invest in from bullion to ETFs to funds to futures to stocks.

"We can't lose track of the fact that this sector, at the end of the day, produces the very metal that made the headlines so the equities should have performed in concert with gold," argued Nadler, "so I think there are some worrisome signs for the bullion side."

Gold mining stocks tried to find their footing Friday. Kinross Gold ( KGC - Get Report) was adding 1.49% to $15 while Randgold Resources ( GOLD - Get Report) rose 1.54% to $80.59. Other gold stocks, Agnico-Eagle ( AEM - Get Report) and Eldorado Gold ( EGO - Get Report) were trading slightly lower at $62.59 and $16.04, respectively.


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-- Written by Alix Steel in New York.

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