Silver Price Analysis: XAG/USD turns vulnerable below $23.55 confluence support


  • Silver remains under some selling pressure for the second successive day on Monday.
  • The intraday break below the $23.55 confluence supports prospects for further losses.
  • A sustained strength beyond the $24.00 mark is needed to offset the negative outlook.

Silver extends Friday's rejection slide from the $24.00 mark, or the 38.2% Fibonacci retracement level of the downfall witnessed in May and drifts lower for the second successive day. The white metal maintains its offered tone, just below the $23.50 level through the early European session on Monday and seems vulnerable to weaken further.

From a technical perspective, the intraday slide drags the XAG/USD below the $23.55 confluence support, comprising the 23.6% Fibo. level and the 100-period Simple Moving Average (SMA) on the 4-hour chart. Moreover, bearish oscillators on daily/4-hour charts add credence to the negative outlook and support prospects for a further intraday depreciating move.

Hence, a subsequent slide, towards testing the $23.00 round figure, looks like a distinct possibility. Some follow-through selling will expose the $22.70-$22.65 region, or over a two-month low touched in May, below which the XAG/USD could eventually drop to the $22.00 mark. The latter represents the very important 200-day SMA and should act as a pivotal point.

On the flip side, sustained strength beyond the $23.55 confluence support breakpoint could allow the XAG/USD to make a fresh attempt towards conquering the $24.00 mark. This is closely followed by the $24.15-$24.20 horizontal resistance, above which the momentum could push the commodity further towards the 50% Fibo. level, around the $24.45-$24.50 region.

The XAG/USD might eventually climb to the $24.80 zone, or the 61.8% Fibo. level, and aim to reclaim the $25.00 psychological mark for the first time since May 11. The upward trajectory could get extended further towards the $25.30-$25.35 supply zone en route to the $26.00 round figure and over a one-year high, around the $26.10-$26.15 area touched in May.

Silver 4-hour chart

fxsoriginal

Key levels to watch

XAG/USD

Overview
Today last price 23.4
Today Daily Change -0.21
Today Daily Change % -0.89
Today daily open 23.61
 
Trends
Daily SMA20 23.86
Daily SMA50 24.45
Daily SMA100 23.36
Daily SMA200 22.12
 
Levels
Previous Daily High 24.02
Previous Daily Low 23.58
Previous Weekly High 24.02
Previous Weekly Low 22.93
Previous Monthly High 26.14
Previous Monthly Low 22.68
Daily Fibonacci 38.2% 23.75
Daily Fibonacci 61.8% 23.85
Daily Pivot Point S1 23.45
Daily Pivot Point S2 23.3
Daily Pivot Point S3 23.01
Daily Pivot Point R1 23.9
Daily Pivot Point R2 24.18
Daily Pivot Point R3 24.34

 

 

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