Silver Price Analysis: XAG/USD looks to build on intraday bounce from $25.80-75 support zone


  • Silver attracted some dip-buying on Monday and climbed back above the $26.00 mark.
  • The recent price action now seemed to constitute the formation of a rectangle pattern.
  • A sustained break through the trading range needed to confirm the near-term direction.

Silver managed to defend the $25.80-75 strong horizontal support and regained positive traction on the first day of a new trading week. The commodity maintained its bid tone through the first half of the European session and was last seen hovering around the $26.10-15 region.

Looking at the technical picture, the XAG/USD has been oscillating in a narrow trading band over the past two weeks or so. This constitutes the formation of a rectangle, which points to indecision over the near-term direction and warrants caution for aggressive traders.

Meanwhile, oscillators on the daily chart – though are holding in the bullish territory – have been struggling to gain any meaningful traction. This makes it prudent to wait for a sustained break through the mentioned range before positioning for the next leg of a directional move.

From current levels, any subsequent move beyond the $26.25 immediate hurdle might continue to confront stiff resistance near the $26.50-60 heavy supply zone. A sustained strength beyond will mark a bullish breakout and assist the XAG/USD to aim back to reclaim the $27.00 round figure.

On the flip side, the $25.80-75 region might continue to protect the immediate downside. Some follow-through selling will turn the XAG/USD vulnerable to accelerate the downfall towards the key $25.00 psychological mark en-route the $24.65-60 horizontal support.

Bearish traders might eventually drag the XAG/USD further towards the $24.00 mark. This is closely followed by YTD lows, around the $23.80-75 region touched on March 31, which if broken decisively will set the stage for a further near-term depreciating move.

XAG/USD 4-hour chart

fxsoriginal

Technical levels to watch

XAG/USD

Overview
Today last price 26.12
Today Daily Change 0.20
Today Daily Change % 0.77
Today daily open 25.92
 
Trends
Daily SMA20 25.72
Daily SMA50 25.87
Daily SMA100 26.01
Daily SMA200 25.55
 
Levels
Previous Daily High 26.2
Previous Daily Low 25.8
Previous Weekly High 26.48
Previous Weekly Low 25.71
Previous Monthly High 26.64
Previous Monthly Low 24.25
Daily Fibonacci 38.2% 25.95
Daily Fibonacci 61.8% 26.04
Daily Pivot Point S1 25.75
Daily Pivot Point S2 25.58
Daily Pivot Point S3 25.36
Daily Pivot Point R1 26.14
Daily Pivot Point R2 26.37
Daily Pivot Point R3 26.54

 

 

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