Silver Price Analysis: XAG/USD seems vulnerable below $26.75-80 confluence breakpoint
|- Silver seemed struggling to capitalize on the overnight bounce from over one-month lows.
- The set-up seems tilted in favour of bearish traders and supports prospects for a further slide.
- A sustained move beyond the $27.00 mark is needed to negate the near-term bearish outlook.
Silver reversed a modest intraday dip and climbed to the top end of its daily trading range, around the $26.75-80 area during the early European session, albeit lacked follow-through.
The mentioned region coincides with a confluence support breakpoint that comprised of 200-period SMA on the 4-hourly chart and a short-term ascending trend-line extending from mid-January. This, in turn, should now act as a key pivotal point for short-term traders.
Meanwhile, technical indicators on the 1-hourly chart have been gaining traction but are yet to confirm a bullish bias on 4-hourly/daily charts. This makes it prudent to wait for some follow-through buying beyond the support-turned-resistance before placing bullish bets.
Any subsequent move beyond might confront a strong barrier near the $27.00 area. That said, a convincing breakthrough will negate the near-term bearish bias and push the XAG/USD back towards the $28.00 mark with some intermediate resistance near the $27.60-65 region.
On the flip side, immediate support is pegged near mid-$26.00s. Sustained weakness below will be seen as a fresh trigger for bearish traders and set the stage for an extension of the white metal's recent sharp pullback from the key $30.00 psychological mark.
The XAG/USD might then accelerate the fall towards the $26.00 mark before eventually dropping to the $25.45-35 congestion zone. The downfall could further get extended towards the $25.00 level en-route the $24.75-70 area and YTD lows, around the $24.00 mark.
XAG/USD 4-hourly 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.