Silver Price Analysis: XAG/USD hits two-week tops, challenges $26.30 supply zone
|- Silver gained some follow-through traction for the second consecutive session on Thursday.
- A sustained move beyond the $26.30 supply zone should pave the way for additional gains.
- Mixed technical indicators on the daily chart warrants caution for aggressive bullish traders.
Silver built on the previous day's positive move and gained some follow-through traction for the second consecutive session on Thursday. The momentum pushed the XAG/USD to near two-week tops, back closer to the $26.25-30 supply zone.
This comes after the XAG/USD showed resilience below the $25.70 confluence support, comprising of the very important 200-day SMA and the 61.8% Fibonacci level of the $23.78-$28.75 move up. Hence, some follow-through buying will be seen as a fresh trigger for bullish traders and pave the way for additional gains.
Meanwhile, technical indicators on the daily chart – though have been recovering from the negative territory – are yet to confirm a bullish bias. This warrants some caution before positioning for a runaway rally as investors might refrain from placing any aggressive bets ahead of Friday's US monthly jobs report.
That said, a sustained move beyond the mentioned barrier has the potential to lift the XAG/USD further beyond the $26.55-60 immediate hurdle, towards the 38.2% Fibo., around the $26.85 region. This is followed by the $27.00 mark, above which the next relevant hurdle is pegged near mid-$27.00s, or the 23.6% Fibo. level.
On the flip side, any meaningful pullback below the $26.00 mark might continue to find decent support near the $25.70 region ahead of weekly swing lows, around mid-$25.00s. A convincing break below might turn the XAG/USD vulnerable and pave the way for a fall towards challenging the key $25.00 psychological mark.
Silver daily chart
Technical levels to watch
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