• Silver gains strong traction for the second straight day and climbs beyond the mid-$19.00s.
  • The neutral technical setup warrants some caution before positioning for any further gains.
  • A sustained strength beyond the $20.00 mark is needed to confirm a fresh bullish breakout.

Silver builds on the previous day's solid recovery from the $18.85-$18.80 support zone and gains some follow-through traction for the second straight day on Friday. The white metal maintains its bid tone through the early European session and is currently trading around the $19.70-$19.80 region, up over 1.30% for the day.

Looking at the broader technical picture, the recent two-way price moves witnessed over the past two weeks or so constitute the formation of a rectangle on the daily. This points to indecision over the near-term trajectory for the XAGUSD. Furthermore, the metal's inability to find acceptance above the 100-day EMA and this week's failures near the $20.00 psychological mark warrants caution for bullish traders.

This makes it prudent to wait for a sustained break through the handle before positioning for any further near-term appreciating move. With oscillators on the daily chart moving in the positive territory, the XAGUSD might then accelerate the momentum towards an intermediate resistance near the $20.50 region. The momentum could get extended and allow the bulls to eventually aim back to reclaim the $21.00 mark.

On the flip side, the daily swing low, around the $19.40 region, now seems to protect the immediate downside ahead of the $19.00 round figure. Any subsequent slide might continue to find decent support near the $18.85-$18.80 horizontal zone, which if broken decisively will shift the bias in favour of bearish traders. The subsequent downfall has the potential to drag the XAGUSD to the $18.30-$18.25 support zone.

This is closely followed by the $18.00 round-figure mark, below which spot prices could slide further towards challenging the YTD low, around the $17.55 zone touched in September.

Silver daily chart

fxsoriginal

Key levels to watch

XAG/USD

Overview
Today last price 19.74
Today Daily Change 0.27
Today Daily Change % 1.39
Today daily open 19.47
 
Trends
Daily SMA20 19.18
Daily SMA50 19.13
Daily SMA100 19.48
Daily SMA200 21.51
 
Levels
Previous Daily High 19.55
Previous Daily Low 18.84
Previous Weekly High 19.78
Previous Weekly Low 18.79
Previous Monthly High 21.24
Previous Monthly Low 18.09
Daily Fibonacci 38.2% 19.27
Daily Fibonacci 61.8% 19.11
Daily Pivot Point S1 19.02
Daily Pivot Point S2 18.57
Daily Pivot Point S3 18.31
Daily Pivot Point R1 19.73
Daily Pivot Point R2 19.99
Daily Pivot Point R3 20.44

 

 

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