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By Melissa Pistilli-Exclusive to Silver Investing News

As the fundamentals behind the US economy continue to teeter on the edge, gold and silver prices are posting impressive gains.

Once again, silver is outperforming gold in its week long price rally that started around $12.50/oz and now flirts with the $14.00 level. Last week, gold rose a mere 3.1 per cent compared to silver’s sharp climb of 11.6 per cent. There are hints in the market that global industrial demand for silver will soon pick up, adding to already robust investment demand.

Other movers of precious metals prices in the last few days include the U.S. unemployment rate and an ever-weakening US dollar. Unemployment reached its highest point since 1983 climbing to nearly 9 per cent. The dollar continues to perform poorly against the Euro and other foreign currencies, lending support to precious metals safe-haven status. The upwards momentum in oil prices is also helping to support gold and silver.

Spot prices for silver are expected to find support at $13.75 per ounce and encounter resistance at $14.10 per ounce.

Many analysts believe precious metals prices have room to grow. “With the global economy not looking to hot, it puts gold and silver in a great situation,” says Chris Vermeulen of GoldAndOilGuy.com. “Countries, and private investors and traders are accumulating precious metals, as protection from falling currencies and will most likely continue doing this for some time, which will continue to push gold and silver higher.”

For the short-term, investors can still expect silver prices to move sideways, but the medium and long term trends are likely to remain bullish.

Investing in Junior Silver Miners

Purchasing shares in silver explorers and producers is one way to leverage an investment in the silver market. “The argument for levering up silver is growing by the day as this precious metal tends to outperform gold in a true bull market,” says ArabianMoney.net’s Peter Cooper.

In a recent interview with The Gold Report, Peter Zihlmann of P. Zihlmann Investment Management discusses why his portfolio focuses more on junior minors rather than major producers.

“Juniors have more price appreciation potential compared to majors because it is easier for them to increase reserves or resources, while the majors struggle to replace what they produce,” answered Zihlmann. “Majors are expensive, too, because the juniors are too small for big institutions to buy them, so the big money goes for the majors.”

Zilhmanns top picks include Orko Silver Corp. [TSX.V: OK], Great Panther Resources [TSX: GPR], Minefinders Corporation [TSX: MFL], Endeavour Silver Corp. [TSX: EDR], and SilverCrest Mines, Inc. [TSX.V: SVL].

Orko Silver is actively increasing its Mexican silver resources and Zihlmann’s firm believes “a share price four times higher than the present will become reality one day.” On Monday, shares of Orko on the TSX closed at .85 cents, down from a 52-week high of $1.87.

Great Panther’s past producing silver mine in Guanajuato, Mexico is believed to hold an additional 500 million ounces. “Nevertheless,” said Zihlmann, “it will take a higher silver price to explore aggressively.” On Monday, shares of Great Panther on the TSX closed at .46 cents, down from a 52-week high of $1.48.

Minefinders has a resource of over five million ounces of gold and 250 million ounces of silver along with over $20 million in cash, about the same in working capital and a positive cash position. On Monday, shares of Minefinders on the TSX closed at $9.45, down from a 52-week high of $12.15.

Endeavour Silver is on its way to becoming a mid-tier producer in Mexico. On Monday, shares of Endeavour on the TSX closed at $1.99, down from a 52-week high of $3.60.

SilverCrest Mines is expected to enter production this year in Sonora, Mexico. On Monday, shares of SilverCrest on the TSX closed at .67 cents, down from a 52-week high of $1.27.

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