• XAG/USD soars as the US bond yields drop two basis points, sitting around 1.52%.
  • A bullish piercing pattern in the daily chart suggests that silver is poised for a rebound.
  • Positive divergence in a daily chart supports XAG/USD prospects of higher prices.

Silver (XAG/USD) is trimming two-day losses, is climbing 3.05% in the day, trading at $22.17 at the time of writing. The rally in XAG/USD is underpinned, by falling US bond yields, with the 10-year benchmark note coupon sitting at 1.520%, down almost two basis points (bps).

The US Dollar Index, which tracks the greenback’s performance against a basket of six currencies, is sliding for the first day out of two, 0.20%, currently at 94.22.

XAG/USD Price Forecast: Technical outlook

Daily chart

XAG/USD price action depicts some confluences. First, the price action of the last two days looks like a bullish piercing pattern, suggesting upside bias. Second, the price action has printed successive lower lows, that coupled with the Relative Strength Index, consecutive higher-lows, portrays a positive divergence that could propel the white-metal for higher prices.

The first supply zone would be $23.00. A break of the latter would expose the 50-day moving average (DMA) at $23.79, followed by the September 3 high at $24.86

On the other hand, failure at $22.00 could pave the way for further losses. The first demand zone would be $21.00. A break of that level could push XAG/USD to the psychological $20.00, followed by July 15, 2020, high at $19.48.

The Relative Strength Index (RSI) is at 38, aiming higher, suggest an easing downward pressure. While RSI remains below the 50-midline, the downtrend could resume; however, the positive divergence could motivate buyers to push prices up. Caution is warranted.

ADDITIONAL LEVELS TO WATCH

XAG/USD

Overview
Today last price 22.16
Today Daily Change 0.62
Today Daily Change % 2.88
Today daily open 21.54
 
Trends
Daily SMA20 23.26
Daily SMA50 23.86
Daily SMA100 25.35
Daily SMA200 25.76
 
Levels
Previous Daily High 22.55
Previous Daily Low 21.42
Previous Weekly High 23.15
Previous Weekly Low 22.04
Previous Monthly High 26
Previous Monthly Low 22.17
Daily Fibonacci 38.2% 21.85
Daily Fibonacci 61.8% 22.12
Daily Pivot Point S1 21.12
Daily Pivot Point S2 20.71
Daily Pivot Point S3 19.99
Daily Pivot Point R1 22.25
Daily Pivot Point R2 22.97
Daily Pivot Point R3 23.38

 

 

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