Silver Price Analysis: XAG/USD seems vulnerable, short-term trading range breakdown in play

Silver registers a modest recovery from a nearly one-month low and snaps a two-day losing streak.
Oversold RSI (14) on hourly charts helps the XAG/USD to find support near the 23.6% Fibo. level.
The technical setup, however, favours bearish traders and supports prospects for additional losses.

Haresh Menghani FXStreet

Silver stages a modest intraday recovery from a nearly one-month low, around the $22.20-$22.15 region touched earlier this Monday and reverses a part of Friday's heavy losses. The white metal, for now, seems to have snapped a two-day losing streak, though the near-term technical setup seems tilted firmly in favour of bearish traders.

The steep decline witnessed over the past two trading sessions confirmed a near-term breakdown through the $23.00-$22.90 strong horizontal support. The said area marked the lower end of a nearly two-month-old trading range and coincided with the 23.6% Fibonacci retracement level of the recent rally from October 2022. Furthermore, acceptance below the 50-day SMA adds credence to the negative outlook for the XAG/USD.

That said, the oversold RSI (14) on hourly charts assists the XAG/USD to find support near the 38.2% Fibo. level and stall its sharp pullback from the highest level since April 2022 touched last week. Hence, it will be prudent to wait for some follow-through selling below the $22.20-$22.15 area before positioning for a fall below the $22.00 mark, towards the next relevant support near the 100-day SMA, around the $21.60-$21.55 zone.

On the flip side, the aforementioned confluence support breakpoint near the $23.00-$22.90 region now seems to act as an immediate strong barrier. Any subsequent move up might now be seen as a selling opportunity and runs the risk of fizzling out near the 50-day SMA, currently around the $23.30-$23.35 region. That said, a sustained strength beyond will negate the bearish bias and prompt some short-covering around the XAG/USD.

Silver daily chart

Key levels to watch

XAG/USD

Overview
Today last price	22.43
Today Daily Change	0.08
Today Daily Change %	0.36
Today daily open	22.35

Trends
Daily SMA20	23.69
Daily SMA50	23.42
Daily SMA100	21.69
Daily SMA200	21.02

Levels
Previous Daily High	23.61
Previous Daily Low	22.29
Previous Weekly High	24.64
Previous Weekly Low	22.29
Previous Monthly High	24.55
Previous Monthly Low	22.76
Daily Fibonacci 38.2%	22.79
Daily Fibonacci 61.8%	23.1
Daily Pivot Point S1	21.89
Daily Pivot Point S2	21.43
Daily Pivot Point S3	20.58
Daily Pivot Point R1	23.21
Daily Pivot Point R2	24.06
Daily Pivot Point R3	24.52

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

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