Silver Price Analysis: XAG/USD consolidates above $25.00 mark, bearish bias remains
|- Silver was seen consolidating the previous day’s sharp fall to over three-month lows.
- The technical set-up favours bearish traders and supports prospects for further losses.
- The $25.70-65 confluence support breakpoint might cap any attempted recovery move.
Silver remained confined in a range above the $25.00 mark through the first half of the European session and consolidated the overnight slump to the lowest level since April 13.
The previous day's sharp fall dragged the XAG/USD below the $25.70-65 confluence support – comprising of the very important 200-day SMA and the 61.8% Fibonacci level of the $23.78-$28.75 move up. A subsequent breakthrough the previous monthly swing lows, around mid-$25.00s was seen as a fresh trigger for bearish traders and has set the stage for additional weakness.
The negative outlook is reinforced by bearish technical indicators on the daily chart, which was still far from being in the oversold territory. Sustained weakness below the key $25.00 psychological mark will reaffirm the bearish bias and prompt some aggressive technical selling. The XAG/USD might then accelerate the fall further towards the $24.70-65 intermediate support.
The downward trajectory could further get extended towards the $24.00 round-figure mark before the XAG/USD eventually drops to challenge YTD lows, around the $23.80-75 region touched in March.
On the flip side, any attempted recovery move might now be seen as a selling opportunity near the mentioned $25.70-65 confluence support breakpoint and runs the risk of fizzling out rather quickly. This is followed by the $26.00 round-figure mark, above which the recovery could further get extended towards the next relevant barrier near the $26.40-50 heavy supply zone.
Silver daily chart
Technical levels to watch
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.