Silver Price Analysis: XAG/USD corrects from over one-week high, slides to $22.75 area

Silver witnessed some selling on Tuesday and eroded a part of the overnight strong gains.
A convincing break below the $22.40 support zone would pave the way for further losses.
Bulls might wait for sustained strength beyond the $23.00 mark before placing fresh bets.

Haresh Menghani FXStreet

Silver struggled to find acceptance above the $23.00 mark, or capitalize on the previous day's strong gains to over one-week high and witnessed some selling on Tuesday. The intraday downfall extended through the early European session and dragged the white metal to a fresh daily low, around the $22.80-$22.75 region in the last hour.

Looking at the technical picture, the latest leg up from the vicinity of the $22.00 mark faltered ahead of the 100-day SMA. The mentioned barrier, currently around the $23.20 area, is followed by the $23.40-$23.45 horizontal resistance. The latter should act as a pivotal point for traders and help determine the near-term trend for the XAG/USD.

Meanwhile, technical indicators on the daily chart – though have been recovering from lower levels – are yet to confirm a bullish bias for the XAG/USD. This, in turn, warrants some caution before confirming that the recent sharp rejection slide from the 200-day SMA has run its course and positioning for any further appreciating move.

From current levels, any subsequent slide is likely to find immediate support near the $22.65 region ahead of the $22.40 area, which if broken would expose the $22.00 round figure. Sustained weakness below should pave the way for a further decline and drag the XAG/USD towards challenging the double-bottom support, around the $21.40 zone.

On the flip side, bulls are likely to wait for a convincing break through the $23.45 hurdle before positioning for any further gains. The XAG/USD might then accelerate the momentum towards reclaiming the $24.00 mark. The momentum could further get extended and allow bulls to challenge the YTD high, around the $24.70 area touched on January 20.

Silver daily chart

Technical levels to watch

XAG/USD

Overview
Today last price	22.86
Today Daily Change	-0.16
Today Daily Change %	-0.70
Today daily open	23.02

Trends
Daily SMA20	23.17
Daily SMA50	22.81
Daily SMA100	23.19
Daily SMA200	24.44

Levels
Previous Daily High	23.1
Previous Daily Low	22.49
Previous Weekly High	23.05
Previous Weekly Low	22.01
Previous Monthly High	24.7
Previous Monthly Low	21.96
Daily Fibonacci 38.2%	22.87
Daily Fibonacci 61.8%	22.73
Daily Pivot Point S1	22.64
Daily Pivot Point S2	22.26
Daily Pivot Point S3	22.03
Daily Pivot Point R1	23.25
Daily Pivot Point R2	23.48
Daily Pivot Point R3	23.86

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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