- Silver remained depressed near the weekly low touched the previous day.
- The set-up favours bearish traders and supports prospects for further losses.
- Sustained move beyond the $22.00 mark is needed to negate the bearish bias.
Silver oscillated in a range, just above mid-$21.00s through the first half of the European session and consolidated the previous day's decline to over a one-week low.
Given the recent failures near the 200-period SMA on the 4-hour chart, acceptance below the $22.00 round-figure mark could be seen as a fresh trigger for bearish traders. Moreover, technical indicators on hourly/daily charts are holding in the bearish territory and add credence to the near-term negative outlook for the XAG/USD.
Some follow-through selling below the $21.50-$21.45 area would reaffirm the bearish bias and pave the way for additional losses. The XAG/USD could then fall to the $21.00 mark with some intermediate support near the $21.30 zone. The downward trajectory could get extended towards the YTD low, around the $20.45 region touched on May 13.
On the flip side, any attempted recovery move might now confront stiff resistance near the $21.90-$22.00 support breakpoint. The said region also marks a confluence barrier comprising the 200-period SMA on the 4-hour chart and the $20.46-$22.52 corrective bounce, which should now act as a key pivotal point for short-term traders.
Sustained strength beyond might trigger a short-covering move and lift spot prices back towards the monthly peak, around the mid-$22.00s touched earlier this week. The momentum could then allow bulls to reclaim the $23.00 round-figure mark and lift the XAG/USD further towards the next relevant hurdle near the $23.30 region.
Silver 4-hour chart
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Key levels to watch
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