• Silver caught aggressive bids on Thursday and surged to a one-week high.
  • The lack of follow-through beyond the 50% Fibo. warrant caution for bulls.
  • Break below mid-$21.00s would set the stage for further near-term losses.

Silver witnessed a dramatic intraday turnaround and rallied nearly 3% from a three-day low, around the $21.30-25 region touched earlier this Thursday. The strong momentum pushed the white metal to a one-week high during the early North American session, with bulls now awaiting sustained strength beyond the $22.00 round-figure mark.

From a technical perspective, the XAG/USD, so far, has struggled to find acceptance above the 50% Fibonacci retracement level of the $23.24-$20.46 downfall. Moreover, technical indicators on the daily chart - though have been recovering - are still holding deep in the bearish territory. This warrants caution before positioning for any further gains.

Hence, a subsequent move up is more likely to attract some selling near the 100-period SMA on the 4-hour chart, currently around the $22.10 region. This is closely followed by the 61.8% Fibo. level, around the $22.20 area, which if cleared will be seen as a fresh trigger for bulls and set the stage for an extension of the recent recovery from the YTD low.

On the flip side, any meaningful pullback now seems to find decent support near mid-$21.00s, or the 38.2% Fibo. level. Sustained breakthrough, leading to some follow-through weakness below the daily low, around the $21.30-$21.25 region, will shift the bias back in favour of bearish traders and prompt aggressive technical selling around the XAG/USD.

The downward trajectory would then drag spot prices to the 23.6% Fibo. level, around the $21.15 area, en-route the $21.00 mark. Bearish traders could eventually aim back to challenge the YTD low, around the $20.45 region touched last week.

Silver 4-hour chart

fxsoriginal

Key levels to watch

XAG/USD

Overview
Today last price 21.59
Today Daily Change -0.04
Today Daily Change % -0.18
Today daily open 21.63
 
Trends
Daily SMA20 22.66
Daily SMA50 24.17
Daily SMA100 23.84
Daily SMA200 23.61
 
Levels
Previous Daily High 21.92
Previous Daily Low 21.51
Previous Weekly High 22.37
Previous Weekly Low 20.46
Previous Monthly High 26.22
Previous Monthly Low 22.68
Daily Fibonacci 38.2% 21.76
Daily Fibonacci 61.8% 21.67
Daily Pivot Point S1 21.46
Daily Pivot Point S2 21.28
Daily Pivot Point S3 21.05
Daily Pivot Point R1 21.86
Daily Pivot Point R2 22.09
Daily Pivot Point R3 22.27

 

 

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