• Silver comes under some selling pressure on Friday, though the downside remains cushioned.
  • The technical setup supports prospects for the emergence of some dip-buying at lower levels.
  • A sustained break below a trend-line resistance breakout point will negate the positive outlook.

Silver edges lower on the last day of the week and moves further away from over a one-week top, around the $21.65-$21.70 region touched on Thursday. The white metal remains on the defensive through the early European session and is currently placed just below the mid-$21.00s.

From a technical perspective, the XAG/USD, so far, has managed to defend the 200-hour SMA. Against the backdrop of a convincing breakout through a one-week-old descending trend-line resistance on Wednesday, the set-up favours bullish traders and supports prospects for a further near-term appreciating move.

The constructive outlook is reinforced by the fact that oscillators on the daily chart are holding in bullish territory. That said, technical indicators on the 1-hour chart have just started gaining negative traction and warrant some caution amid relatively thin liquidity conditions in the markets.

Nevertheless, the XAG/USD seems poised to surpass the overnight swing high, around the $21.65-$21.70 region, and reclaim the $22.00 mark. This is followed by a five-month high, around the $22.25 zone, above which spot prices could climb to the $22.50-$22.60 area en route to the $23.00 round figure.

On the flip side, the $21.00 mark could act as an immediate support ahead of the ascending trend-line resistance breakpoint, currently around the $20.80 region. A convincing break below the latter could negate the positive outlook and possibly shift the near-term bias in favour of bearish traders.

The XAG/USD might then accelerate the downfall to the $20.60-$20.55 area (weekly low) before eventually dropping to challenge the $20.00 psychological mark. Some follow-through selling might expose the $19.00 round-figure mark, with some intermediate support near the $19.65-$19.60 region.

Silver 1-hour chart

fxsoriginal

Key levels to watch

XAG/USD

Overview
Today last price 21.36
Today Daily Change -0.14
Today Daily Change % -0.65
Today daily open 21.5
 
Trends
Daily SMA20 20.8
Daily SMA50 19.92
Daily SMA100 19.58
Daily SMA200 21.38
 
Levels
Previous Daily High 21.68
Previous Daily Low 21.46
Previous Weekly High 22.25
Previous Weekly Low 20.75
Previous Monthly High 21.24
Previous Monthly Low 18.09
Daily Fibonacci 38.2% 21.54
Daily Fibonacci 61.8% 21.6
Daily Pivot Point S1 21.41
Daily Pivot Point S2 21.33
Daily Pivot Point S3 21.19
Daily Pivot Point R1 21.63
Daily Pivot Point R2 21.76
Daily Pivot Point R3 21.85

 

 

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