Silver Price Analysis: XAG/USD inches closer to $25.35-40 confluence resistance

Silver built on the previous day’s solid intraday bounce from over two-month lows.
Mixed oscillators on hourly/daily charts warrant some caution for aggressive traders.
A sustained move beyond the $24.40 supply zone is needed to confirm a bullish bias.

Haresh Menghani FXStreet

Silver showed some resilience below the very important 200-day SMA on Thursday and stage a solid intraday bounce from over two-month lows.

The recovery extended through the early part of the trading action on Friday and pushed the while metal towards the top end of a short-term descending channel. The XAG/USD was last seen trading around the $25.20 region, up 0.70% for the day.

Meanwhile, technical indicators on the 1-hourly chart have been gaining positive traction. However, bearish oscillators on 4-hourly/daily charts warrant some caution before positioning for any strong follow-through positive move.

Hence, any subsequent positive move is more likely to confront stiff resistance near the $25.35-40 supply zone. A sustained move beyond will mark a bullish breakout and prompt some aggressive short-covering move around the XAG/USD.

The commodity might then aim back to reclaim the $26.00 mark. The momentum could further get extended and push the commodity back towards the $26.40-50 supply zone, tested in the aftermath of the dovish FOMC statement last week.

On the flip side, the key $25.00 psychological mark now seems to protect the immediate downside. Failure to defend the mentioned support will shift the bias back in favour of bearish traders and turn the XAg/USD vulnerable.

The next relevant target on the downside is pegged near the $24.65 region (200-DMA), below which the XAG/USD could accelerate the fall towards challenging YTD lows, around the $24.00 mark touched on January 18.

XAG/USD 4-hourly chart

Technical levels to watch

XAG/USD

Overview
Today last price	25.21
Today Daily Change	0.18
Today Daily Change %	0.72
Today daily open	25.03

Trends
Daily SMA20	25.87
Daily SMA50	26.35
Daily SMA100	25.65
Daily SMA200	24.72

Levels
Previous Daily High	25.19
Previous Daily Low	24.41
Previous Weekly High	26.64
Previous Weekly Low	25.76
Previous Monthly High	30.07
Previous Monthly Low	25.9
Daily Fibonacci 38.2%	24.71
Daily Fibonacci 61.8%	24.89
Daily Pivot Point S1	24.56
Daily Pivot Point S2	24.1
Daily Pivot Point S3	23.78
Daily Pivot Point R1	25.35
Daily Pivot Point R2	25.66
Daily Pivot Point R3	26.13

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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