- Silver met with a fresh supply in the vicinity of the $25.00 psychological mark on Wednesday.
- Neutral technical indicators on the daily chart warrant caution before placing directional bets.
- Sustained weakness below mid-$24.00s is needed to confirm the near-term bearish outlook.
Silver struggled to capitalize on the previous day's late rebound from the two-week low and met with a fresh supply in the vicinity of the $25.00 mark on Wednesday. The white metal remained on the defensive through the first half of the European session and was last seen around the $24.80 region.
From a technical perspective, the recent pullback from the $27.00 neighbourhood or the highest level since June 2021 stalled near the 50% Fibonacci retracement level of the $22.00-$26.95 move up. This should now act as a key pivotal point and determine the near-term trajectory for the XAG/USD.
The attempted recovery, however, faltered near the 38.2% Fibo. level, around the $25.00 psychological mark. This, in turn, favours bearish traders and supports prospects for further losses. That said, technical indicators on the daily chart are yet to confirm the outlook and warrant some caution.
Hence, it will be prudent to wait for some follow-through selling below the overnight swing low, around the $24.55-$24.50 region before placing aggressive bearish bets. The XAG/USD might then accelerate the downward trajectory towards testing sub-$24.00 levels, or the 61.8% Fibo. support.
On the flip side, momentum back above the $25.00 mark now seems to confront stiff resistance near the 23.6% Fibo. level, around the $25.75-$25.80 region. Some follow-through buying, leading to a move beyond the $26.00 mark should be enough to negate the near-term bearish bias for the XAG/USD.
The next relevant hurdle is pegged near the $26.40 region, above which bulls could make a fresh attempt to conquer the $27.00 mark and push the XAG/USD further towards mid-$27.00s. The momentum could get extended towards the $28.00 mark en-route the May 2021 daily closing high, around the $27.90 area.
Silver daily chart
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Technical levels to watch
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