Silver Price Analysis: XAG/USD hangs near the lower end of two-month-old trading range
|- Silver witnessed some selling for the third consecutive session on Tuesday.
- The recent range-bound price action warrants caution for aggressive traders.
Silver struggled to capitalize on the previous day's goodish rebound from the $27.45 region and met with some fresh supply on Tuesday. The commodity maintained its offered tone through the early North American session and was last seen trading around the $27.65 area, down 0.70% for the day.
From a technical perspective, the XAG/USD, so far, has managed to defend a support marked by the 200-period SMA on the 4-hour chart. This is followed by the lower boundary of a near one-month-old trading range, around the $27.20 region, which should now act as a key pivotal point for short-term traders.
Meanwhile, technical indicators on the daily chart – though have been losing the positive momentum – are yet to confirm a bearish bias. This warrants some caution and makes it prudent to wait for a convincing break through the trading range support before positioning for any further downfall.
Some follow-through selling below the $27.00 mark will confirm a near-term bearish break and prompt some aggressive technical selling. The XAG/USD might then accelerate the slide towards the $26.60 horizontal resistance breakpoint, now turned support, en-route the $26.00 round-figure mark.
The downward trajectory could further get extended towards challenging the very important 200-day SMA, currently near the $25.75 region.
On the flip side, the $28.00 mark now seems to have emerged as an immediate strong hurdle ahead of the $28.25-30 supply zone. A sustained strength beyond has the potential to push the XAG/USD towards monthly tops, around the $28.75 region en-route the next relevant resistance near the $29.00 mark.
XAG/USD 4-hour 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.