Silver Price Analysis: XAG/USD climbs back closer to weekly top, upside seems limited

Silver (XAG/USD) builds on the previous day's goodish recovery from the $22.15 area, or over a two-week low and trades with a positive bias for the second successive day on Friday. The momentum lifts the white metal to the top end of its weekly range, around the $22.70 region during the first half of the European session, albeit lacks bullish conviction.

From a technical perspective, the commodity's inability to attract any follow-through buying, along with neutral oscillators on the daily chart, warrants some caution for bullish traders and positioning for any further gains. Hence, any subsequent move up is more likely to confront stiff resistance near the $22.85 region, which is closely followed by a descending trend-line hurdle near the $23.00 round figure.

The latter should act as a key pivotal point, which if cleared decisively might shift the near-term bias in favour of bulls and pave the way for a further appreciating move. Some follow-through buying beyond the 200-day Simple Moving Average (SMA), currently pegged near the $23.25-$23.30 zone, will reaffirm the positive outlook and allow the XAG/USD aim back to reclaim the $24.00 round figure.

The upward trajectory could get extended further towards the next relevant hurdle near the $24.50-$24.60 region before the white metal eventually climbs to the $25.00 psychological mark.

On the flip side, the $22.40 horizontal zone now seems to protect the immediate downside ahead of the $22.20-$22.15 area, below which the XAG/USD could retest sub-$22.00 levels or a two-month trough touched in January. Some follow-through selling will expose the $21.40-$21.35 support before the white metal weakens further below the $21.00 mark, towards the October swing low near the $20.70-$20.65 zone.

Silver daily chart

Technical levels to watch