- Silver gains positive traction and snaps an eight-day losing streak to over a two-week low.
- The technical setup supports prospects for the emergence of fresh selling at higher levels.
- Bears might wait for a fall below the $22.85-80 region before positioning for further decline.
Silver attracts some buyers on the first day of a new week, snapping an eight-day losing streak, and climbs back above the $23.00 round-figure mark during the Asian session. The white metal, however, remains well within the striking distance of a two-and-half-week low, around the $22.85-$22.80 region retested on Friday, and still seems vulnerable to slide further.
The negative outlook is reinforced by the fact that oscillators on the daily chart have been gaining negative traction and are away from being in the oversold zone. Moreover, the Relative Strength Index (RSI) on the 4-hour chart has also recovered from the oversold territory. This, in turn, suggests that the path of least resistance for the XAG/USD remains to the downside.
Hence, any subsequent move up might still be seen as a selling opportunity and remain capped near the very important 200-day Simple Moving Average (SMA), currently pegged near the $23.45-$23.50 area. This is followed by the 100-day SMA barrier, around the $23.80 region, and the $24.00 mark, which if cleared decisively will negate the negative outlook for the XAG/USD.
The subsequent short-covering move has the potential to lift the white metal beyond the $24.30-$24.35 supply zone, towards reclaiming the $25.00 psychological mark. The latter represents the August monthly swing high and should act as a pivotal point. A sustained strength beyond will be seen as a fresh trigger for bullish traders and pave the way for a further appreciating move.
On the flip side, bearish traders need to wait for some follow-through selling below the $22.85-$22.80 area before placing fresh bets. The XAG/USD might then accelerate the fall below the $22.65-$22.60 support, towards challenging a strong horizontal support near the $22.20-$22.10 zone. This is followed by the $22.00 mark, which if broken will confirm a fresh breakdown.
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. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD retreats toward 1.0850 on modest USD recovery
EUR/USD stays under modest bearish pressure and trades in negative territory at around 1.0850 after closing modestly lower on Thursday. In the absence of macroeconomic data releases, investors will continue to pay close attention to comments from Federal Reserve officials.
GBP/USD holds above 1.2650 following earlier decline
GBP/USD edges higher after falling to a daily low below 1.2650 in the European session on Friday. The US Dollar holds its ground following the selloff seen after April inflation data and makes it difficult for the pair to extend its rebound. Fed policymakers are scheduled to speak later in the day.
Gold climbs to multi-week highs above $2,400
Gold gathered bullish momentum and touched its highest level in nearly a month above $2,400. Although the benchmark 10-year US yield holds steady at around 4.4%, the cautious market stance supports XAU/USD heading into the weekend.
Chainlink social dominance hits six-month peak as LINK extends gains
-637336005550289133_XtraSmall.jpg)
Chainlink (LINK) social dominance increased sharply on Friday, exceeding levels seen in the past six months, along with the token’s price rally that started on Wednesday.
Week ahead: Flash PMIs, UK and Japan CPIs in focus – RBNZ to hold rates
After cool US CPI, attention shifts to UK and Japanese inflation. Flash PMIs will be watched too amid signs of a rebound in Europe. Fed to stay in the spotlight as plethora of speakers, minutes on tap.