- Silver enters a bearish consolidation phase and oscillates in a narrow range around the $20.00 mark.
- The technical setup supports prospects for an extension of the recent well-established downtrend.
- A slightly oversold RSI on the daily chart is holding back bearish traders from placing fresh bets.
Silver struggles to gain any meaningful traction and extends its sideways consolidative price move around the $20.00 psychological mark through the mid-European session on Thursday. The white metal, meanwhile, remains well within the striking distance of over a four-month low touched on Wednesday and seems vulnerable to prolonging its downward trajectory witnessed since early February.
The recent breakdown through a technically significant 200-day Exponential Moving Average (EMA) was seen as a fresh trigger for bearish traders. Furthermore, this week's sustained weakness below the $20.50-$20.40 horizontal support, which coincided with the previous YTD low, adds credence to the negative outlook. This, in turn, suggests that the path of least resistance for the XAG/USD is to the downside.
That said, Relative Strength Index (RSI) on the daily chart is hovering in the oversold territory. Moreover, repeated failures to find acceptance below the $20.00 psychological mark make it prudent to wait for near-term consolidation before placing fresh bets around the XAG/USD. Nevertheless, the metal's inability to attract any buyers suggests that the near-term descending trend is still far from being over.
Hence, a subsequent slide towards testing the $19.60 intermediate support, en route to the $19.00 round-figure mark, looks like a distinct possibility. Some follow-through selling should pave the way for a slide towards the next relevant support near the $18.80-$18.75 region before the XAG/USD eventually drops to $18.30-$18.25 horizontal zone and the $18.00 level, which should offer strong support.
On the flip side, the $20.40-$20.50 support breakpoint now seems to act as an immediate barrier. Any further recovery is likely to attract fresh sellers and remains capped near the 200-day Simple Moving Average (SMA), currently pegged just ahead of the $21.00 mark. The latter should act as a pivotal point, which if cleared decisively could lift the XAG/USD to the mid-$21.00s. Bulls
might then aim to reclaim the $22.00 mark.
Silver daily chart
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 trims gains after reaching weekly highs at 1.0925
EUR/USD peaked at 1.0925 on Thursday, the highest level in a week, then retreated to the 1.0900 area. The pair is holding on to strong daily gains, on its way to the highest daily close since early February, supported by a weaker US Dollar ahead of Friday’s US Core PCE data.
GBP/USD eyes 1.2400 as Pound outperforms
The Pound is among the top performers of the American session. GBP/USD is trading at the highest level in almost two months, near 1.2400. Risk flows are helping the pair while at the same time making it difficult for the US Dollar to find demand.
Gold: Bulls aiming to challenge the $2,000 threshold Premium
Spot Gold found demand during American trading hours and currently trades around the $1,980 level. Following a consolidative stage, the bright metal gained upward traction on the back of continued US Dollar weakness.
Cardano might have a bumpy road following a 25% recovery
Cardano price has had a disappointing run these last two weeks when compared to other major altcoins.
FTSE100 up for 4th day in a row, hits 2-week high
We’ve seen another positive day for European markets with the FTSE100 pushing up to its highest levels in 2 weeks, although it remains well short of reversing its March losses, unlike the DAX which has reversed nearly all its post 9th March decline.