Silver Price Analysis: XAG/USD flirts with two-day lows, around $27.75-70 area

Silver witnessed some follow-through selling for the second consecutive session on Monday.
Mixed technical indicators warrant some caution before placing any aggressive directional bets.

Haresh Menghani FXStreet

Silver extended the previous day's retracement slide from one-and-half-week tops and witnessed some follow-through selling on the first day of a new trading week. This marked the second consecutive day of a negative move and dragged the commodity to two-day lows, around the $27.70 region during the early European session.

From a technical perspective, last week's positive move faltered near the $28.25-30 region, marking a short-term ascending trend-line support breakpoint, now turned resistance. This should now act as a key pivotal point for short-term traders and help determine the next leg of a directional move for the XAG/USD.

Meanwhile, technical indicators on hourly charts have been drifting lower in the bearish territory and support prospects for additional intraday weakness. That said, oscillators on the daily chart – though have been losing the positive momentum – are yet to confirm a bearish bias and warrant some caution for traders.

Hence, any subsequent fall is more likely to find decent support near the $27.40 region, or the lower boundary of a near one-month-old trading range. This is followed by the $27.20 horizontal support and the $27.00 mark, which if broken might be seen as a fresh trigger for bearish traders and prompt aggressive selling.

The next relevant support is pegged near the $26.60 area. Some follow-through selling might turn the XAG/USD vulnerable to accelerate the fall further towards the $26.00 mark. The downward trajectory could further get extended towards challenging the very important 200-day SMA, currently near the $25.75-70 region.

On the flip side, the $28.00 mark now seems to act as an immediate strong resistance ahead of the $28.25-30 supply zone. Sustained strength above has the potential to push the XAG/USD towards monthly tops, around the $28.75 region. Bulls might eventually push the commodity beyond the $29.00 mark, towards testing the $29.40-50 hurdle.

XAG/USD daily chart

Technical levels to watch

XAG/USD

Overview
Today last price	27.74
Today Daily Change	-0.20
Today Daily Change %	-0.72
Today daily open	27.94

Trends
Daily SMA20	27.86
Daily SMA50	26.85
Daily SMA100	26.57
Daily SMA200	25.73

Levels
Previous Daily High	28.29
Previous Daily Low	27.9
Previous Weekly High	28.29
Previous Weekly Low	27.47
Previous Monthly High	28.75
Previous Monthly Low	25.81
Daily Fibonacci 38.2%	28.05
Daily Fibonacci 61.8%	28.14
Daily Pivot Point S1	27.8
Daily Pivot Point S2	27.65
Daily Pivot Point S3	27.41
Daily Pivot Point R1	28.19
Daily Pivot Point R2	28.43
Daily Pivot Point R3	28.58

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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