Silver Price Analysis: XAG/USD hovers above $24.00; bearish head and shoulders in the making

Silver moves away from a multi-week high set on Wednesday, albeit lacks follow-through.
A convincing break below the $23.80 confluence should pave the way for deeper losses.
Bulls might now wait for a move beyond the $24.35 region before placing aggressive bets.

Haresh Menghani FXStreet

Silver remains under some selling pressure for the second successive day on Friday and retreats further from a three-week top, around the $24.35 region touched on Wednesday. The white metal remains depressed through the early part of the European session and currently trades around the $24.00 round-figure mark, down just over 0.10% for the day.

The XAG/USD, however, manages to hold above the $23.85-$23.80 confluence, comprising the 23.6% Fibonacci retracement level of the recent rally from the monthly low and the 200-period Simple Moving Average (SMA) on the 4-hour chart. The said area could act as a pivotal point for intraday traders and help limit any further decline, against the backdrop of positive technical indicators on 4-hour/daily charts.

A sustained break below, however, might prompt some technical selling and drag the XAG/USD towards the 38.2% Fibo. level, around the $23.55 region. This is closely followed by another confluence support near the $23.40 area, comprising the 200-day SMA and the 50% Fibo. level, which if broken decisively might shift the near-term bias in favour of bearish traders and pave the way for some meaningful downside.

Silver 4-hour chart

Zooming out to the daily chart, the recent price action witnessed since early June seems to constitute the formation of a bearish head and shoulders pattern on the daily chart. The pattern, however, will be confirmed on a sustained break below the neckline support, around the $22.20-$22.10 region.

XAG/USD daily chart

In the meantime, bulls need to wait for some follow-through buying beyond the overnight swing high, around the $24.35 area, before placing fresh bets. The XAG/USD might then aim to surpass the $24.55-$24.60 intermediate hurdle and aim to reclaim the $25.00 psychological mark before climbing to the $25.25 zone, or the July monthly swing high. Some follow-through buying should pave the way for a rise to the $26.00 mark.

Technical levels to watch

XAG/USD

Overview
Today last price	24.09
Today Daily Change	-0.03
Today Daily Change %	-0.12
Today daily open	24.12

Trends
Daily SMA20	23.32
Daily SMA50	23.53
Daily SMA100	23.99
Daily SMA200	23.33

Levels
Previous Daily High	24.35
Previous Daily Low	24.06
Previous Weekly High	23.01
Previous Weekly Low	22.23
Previous Monthly High	25.27
Previous Monthly Low	22.52
Daily Fibonacci 38.2%	24.17
Daily Fibonacci 61.8%	24.24
Daily Pivot Point S1	24
Daily Pivot Point S2	23.88
Daily Pivot Point S3	23.7
Daily Pivot Point R1	24.3
Daily Pivot Point R2	24.47
Daily Pivot Point R3	24.59

Author

Haresh Menghani

FXStreet

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

GBP/USD revisits 1.3530; Dollar pushes harder

GBP/USD adds to the weekly correction and recedes toward the 1.3530 zone on Friday. Indeed, Cable faces increasing selling pressure on the back of extra gains in the Greenback, particularly fuelled by Chair Warsh’s speech at the Jackson Hole Symposium and the US NFP Annual Revision (-79K).

EUR/USD breaches below 1.1600, multi-day lows

EUR/USD now accelerates its decline and retreats to seven-day troughs in the sub-1.1600 region at the end of the week. The pair’s pullback comes on the back of the strong rebound in the US Dollar after Chair Warsh delivered a hawkish message in Jackson Hole, while the US NFP Annual Revision came in at -79K.

Gold battles key support amid renewed Iran and Fed hike risks

Gold is resuming Friday’s steep downside early Monday as the NFP week kicks in. US Dollar sees a profit-taking pullback, despite hawkish Fed’s Warsh and fresh Iran risks. Gold attacks 21-day SMA near $4,400 after Friday’s close below 200-day SMA; RSI is still bullish.

Week ahead: RBNZ and BoC decide on rates ahead of all-important US NFP

The US dollar staged a modest recovery this week, perhaps as traders decided to cover some of their short positions amid slightly stickier or in-line US PCE inflation numbers for July, confounding expectations of softer prints amid the softness revealed in the CPI data for the month.

Bitcoin slips below $78,000 – DEX tokens rally

Bitcoin price is trading above $77,000 on Monday, sustaining monthly gains of over 20% so far. The technical outlook for Bitcoin is bullish as the price holds above a crucial retracement support level at $76,706 amid broader market risk-on sentiment. Decentralized Exchange tokens, Uniswap and PancakeSwap, emerge as top performers over the last 24 hours, eyeing further gains.

Diesel’s record $100 warning: The oil shock hiding in plain sight

The Oil market may look calmer than it did a few months ago, but diesel is sending a very different message. The US diesel crack spread, the premium of ultra-low sulphur diesel futures over WTI, recently surged above $100 per barrel for the first time, reaching an intraday record of just over $102.00.