Silver Price Analysis: XAG/USD remains on the defensive above $24.00, bullish potential intact

Silver edges lower during the first half of trading on Tuesday, though lacks follow-through and remains well within the previous day's broader trading range. The white metal manages to hold its neck above the $24.00 mark and seems poised to appreciate further.

The recent price action witnessed over the past month or so constitutes the formation of an ascending channel. The lower end of the said trend channel, currently around the $23.40-$23.35 area, coincides with the 200-period SMA on the 4-hour chart and should act as a pivotal point for the XAG/USD.

Oscillators on 4-hour/daily charts - though have been losing traction - are holding in the positive territory and favour bullish traders. That said, it will be prudent to wait for some follow-through buying beyond the multi-month peak, around the $24.50 area, before positioning for further gains.

The subsequent move up has the potential to lift the XAG/USD towards the $25.00 psychological mark for the first time since April 2022. Some follow-through buying should pave the way for an extension of the appreciating move towards the next relevant hurdle near the $25.35-$25.40 resistance zone.

On the flip side, any meaningful slide below the $24.00 mark is more likely to attract fresh buyers and remain limited near the aforementioned confluence support, around the $23.40-$23.35 area. A convincing break below will negate the positive outlook and shift the bias in favour of bearish traders.

The XAG/USD might then turn vulnerable to weaken below the $23.00 round-figure mark and accelerate the fall towards the $22.60-$22.55 region. The downward trajectory could get extended further towards the next relevant support near the $22.10-$22.00 zone.

Silver 4-hour chart

Key levels to watch