With the uncertain economic conditions and fear prompting investors to look for safety, gold has gotten a lot of attention lately. But it is silver that is producing the nice trending move that many traders like.

•  Gold still seems to be caught between the deflation and inflation scenarios, being pulled up or down on almost a daily basis without a consistent trend, while the once too-risky silver futures have produced a relatively smooth uptrend since mid-January following a VantagePoint predicted medium-term moving average crossover signal (circle on chart) with the predicted neural index at a bullish reading of 1.00.

•  In addition to a bullish moving average crossover, bullish silver traders relying on traditional chart analysis got a good breakout signal above a previous high around $11.75 an ounce (red dashed horizontal line).

•  Investors seem to be far from convinced that any bailout plan will work, judging by how the stock market reacted to the latest compromise proposal Tuesday, and seem to be suspicious about the value of any currency or fiat money or any paper asset, preferring to put their money into real assets like metals or metals exchange-traded funds..

•  Gold is still priced at 70 times the price of silver compared to a normal ratio historically of about 50-to-1, leaving room for silver to gain on gold, even if gold prices falter.

Source: VantagePoint Intermarket Analysis Software

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