Silver As A Cheap Gold Proxy?Options Xpressupdated Jan 31, 2013TweetAt GET.com we maintain complete editorial integrity on our content & provide transparent & unbiased information. Companies don't pay us to include their products although we receive a compensation when you successfully apply to products from our partners. See how we make money here.At GET.com we maintain complete editorial integrity.Thursday, January 31, 2013 Silver has become a cheap Gold proxy for some investors in recent weeks, as prices have lagged behind the yellow metal. The weaker GDP data could hurt Silver prices. However, weaker industrial demand for the metal could be offset by investment demand. It is troubling that the economy has not been able to grow with quantitative easing in place, so the Fed may be pressured to be more aggressive in this regard. The FOMC statement may suggest that QE is here for the foreseeable future, which could provide a major boost for Silver.Fundamentals Some investors have boosted their demand for Silver as an investment vehicle in the month of January. The US mint has sold a record number of American Eagle silver coins. This is not surprising; given the fact that Silver is relatively cheap when compared to Gold. On the macroeconomic front, the US economy showing a contraction for Q4 can be seen as possibly limiting the upside of Silver. The FOMC held rates steady, which is not a surprise. The central bank's policy statement emphasized its concern over economic growth grinding to a halt and the possibility of deflation. The statement has led many to believe quantitative easing may be here to stay. While more easing may likely be seen as a boost for precious metal prices, the anemic growth prospects may lead to weaker industrial demand for the metal. This brings about the question of whether or not investment demand can supplant the void left from industry.Technical Notes Turning to the chart, we see the March Silver chart holding at 31.00 in recent sessions. For the market to maintain its upside momentum, prices need to hold this level. In addition to 31.00, the 30.00 mark can be seen as critical support. Failure to hold the level could result in prices tumbling several dollars. On the upside, prices may need to take out the relative high close of 32.41 to maintain its upward momentum. Currently, the RSI is at overbought level , which may limit the near-term upside of the market. Rob Kurzatkowski, Senior Commodity AnalystEditorial Disclosure: Any personal views and opinions expressed by the author in this article are the author's own and do not necessarily reflect the viewpoint of GET.com. The editorial content on this page is not provided by any of the companies mentioned, and has not been reviewed, approved or otherwise endorsed by any of these entities. Opinions expressed here are author's alone, not those of the companies mentioned, and have not been reviewed, approved or otherwise endorsed by any of these entities.