Silver Price Analysis: XAG/USD rebound needs validation from 50-DMA
- Silver refreshes intraday high, extends bounce off six-week low.
- Bearish MACD signals, sustained break of two-month-old previous support line favor sellers.
- Multiple levels from August restrict immediate downside, September’s bottom lure bears.
Silver (XAG/USD) consolidates monthly losses around the lowest levels since mid-October during early Monday.
The bright metal dropped to the multi-day low following the previous week’s clear downside break of an ascending trend line from September 29 and 50-DMA. However, a three-month-old horizontal support area triggered the quote’s latest bounce.
Even so, bearish MACD signals and sustained trading below the stated support-turned-resistance line keep XAG/USD sellers hopeful.
That said, the 38.2% Fibonacci retracement (Fibo.) level of July-September downside and 50-DMA, respectively around $23.50 and $23.60, limit the commodity’s rebound
Should the silver buyers manage to cross the $23.60 hurdle, 50% Fibo. level of $24.10 and the stated previous support line, around $24.20 by the press time, will be in focus.
Alternatively, the $22.91-85 support area becomes the key challenge for the short-term sellers ahead of August month’s low near $22.20 and the $22.00 threshold.
Given the silver bears stay on the front foot past $22.00, the yearly bottom surrounding $21.40 may challenge the commodity bears before directing them to the $20.00 psychological magnet.
Silver: Daily chart
Trend: Bearish
Author
Anil Panchal
FXStreet
Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.
