- Silver gained positive traction on Friday and reversed a part of the previous day’s slide to the YTD low.
- Extremely oversold RSI (14) on the daily chart was seen as a key factor that prompted short-covering.
- The double-bottom support breakpoint, near the $21.40 area, should now cap any meaningful upside.
Silver witnessed a short-covering bounce on the last day of the week and recovered a part of the overnight slump to its lowest level since July 2020. The recovery momentum extended through the early European session and pushed spot prices back closer to the $21.00 round-figure mark.
Given that RSI (14) on the daily chart is flashing extremely oversold conditions, traders opted to lighten their bearish bets around the XAG/USD amid modest US dollar pullback from a two-decade high. Ay meaningful upside, however, still seems elusive amid the risk-on impulse in the markets.
The overnight sustained below the double-bottom support near the $21.40 region was seen as a fresh trigger for bearish trades. This comes on the back of the recent breakdown through an ascending trend-line and suggests the attempted recovery runs the risk of fizzling out rather quickly.
Hence, any subsequent move up is more likely to confront stiff resistance and remain capped near the aforementioned support breakpoint, around the $21.40 area. That said, sustained strength beyond has the potential to lift the XAG/USD and allow bulls to reclaim the $22.00 round figure.
On the flip side, the YTD low, around the $20.65-$20.60 region, now seems to protect the immediate downside. Some follow-through selling would reaffirm the near-term negative bias and make the XAG/USD vulnerable to slide further towards challenging the $20.00 psychological mark.
Silver daily chart
-637880253442209610.png)
Key levels to watch
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD holds steady near 1.0650 amid risk reset
EUR/USD is holding onto its recovery mode near 1.0650 in European trading on Friday. A recovery in risk sentiment is helping the pair, as the safe-haven US Dollar pares gains. Earlier today, reports of an Israeli strike inside Iran spooked markets.
GBP/USD recovers toward 1.2450 after UK Retail Sales data
GBP/USD is rebounding toward 1.2450 in early Europe on Friday, having tested 1.2400 after the UK Retail Sales volumes stagnated again in March, The pair recovers in tandem with risk sentiment, as traders take account of the likely Israel's missile strikes on Iran.
Gold price defends gains below $2,400 as geopolitical risks linger
Gold price is trading below $2,400 in European trading on Friday, holding its retreat from a fresh five-day high of $2,418. Despite the pullback, Gold price remains on track to book the fifth weekly gain in a row, supported by lingering Middle East geopolitical risks.
Bitcoin Weekly Forecast: BTC post-halving rally could be partially priced in Premium
Bitcoin price shows no signs of directional bias while it holds above $60,000. The fourth BTC halving is partially priced in, according to Deutsche Bank’s research.
Geopolitics once again take centre stage, as UK Retail Sales wither
Nearly a week to the day when Iran sent drones and missiles into Israel, Israel has retaliated and sent a missile into Iran. The initial reports caused a large uptick in the oil price.