• Silver lacked any firm directional bias and seesawed between tepid gains/minor losses.
  • The technical set-up favours bearish traders and supports prospects for further downside.
  • Sustained move beyond the $22.00 mark is needed to negate the near-term negative bias.

Silver struggled to gain any meaningful traction and oscillated in a narrow trading band for the second successive day on Wednesday. The XAG/USD was last seen trading around the $21.55-$21.60 region, down nearly 0.10% during the early North American session.

From a technical perspective, the recent bounce from the lowest level since July 2020 faltered near the 50% Fibonacci retracement level of the $23.24-$20.46 downfall. The subsequent slide confirmed a bearish break through the lower end of an ascending trend channel.

Given the recent slump, the aforementioned trend channel constitutes the formation of a bearish flag pattern. Moreover, oscillators on the daily chart are still holding deep in the negative territory, supporting prospects for a further near-term depreciating move.

That said, the lack of follow-through selling below the 38.2% Fibo. level warrants caution for bearish traders. Nevertheless, the XAG/USD still seems vulnerable to weakening further towards the 23.6% Fibo. level, around the $21.15 region, en-route the $21.00 mark.

On the flip side, any meaningful recovery now seems to confront stiff resistance and meet with a fresh supply near the $21.85 region, or the 50% Fibo. level. That said, some follow-through buying beyond the $22.00 mark trigger a fresh bout of a short-covering rally.

The XAG/USD might then surpass the 61.8% Fibo. level, around the $22.20 region and accelerate the momentum to the next relevant hurdle near the $22.55 area.

Silver 1-hour chart

fxsoriginal

Key levels to watch

XAG/USD

Overview
Today last price 21.59
Today Daily Change -0.04
Today Daily Change % -0.18
Today daily open 21.63
 
Trends
Daily SMA20 22.66
Daily SMA50 24.17
Daily SMA100 23.84
Daily SMA200 23.61
 
Levels
Previous Daily High 21.92
Previous Daily Low 21.51
Previous Weekly High 22.37
Previous Weekly Low 20.46
Previous Monthly High 26.22
Previous Monthly Low 22.68
Daily Fibonacci 38.2% 21.76
Daily Fibonacci 61.8% 21.67
Daily Pivot Point S1 21.46
Daily Pivot Point S2 21.28
Daily Pivot Point S3 21.05
Daily Pivot Point R1 21.86
Daily Pivot Point R2 22.09
Daily Pivot Point R3 22.27

 

 

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