Silver rallies to test bearish commitments
- Silver bulls stepping into gear and take on key resistance.
- There could be a discount to come yet in the bullish impulse on the daily chart.
XAG/USD was ending Wall Street 0.83% higher and had travelled from a low of $27.46.
The US dollar has edged lower on Tuesday to print 89.5350 for a fresh 4-1/2 month lows against a basket of peers in the DXY.
Meanwhile, the commodities complex was down on the day according to the CRB index that fell 0.26% by the close on Wall Street.
The wider market is consolidating in the main due to data that shows inflationary pressures but Fed Reserve officials say it will not last.
Fed vice-Chair Richard Clarida said price pressures would prove to be largely transitory. This follows similar comments from other Fed officials.
Technical analysis
As per the prior analysis, Silver is on track for a daily upside extension, XAG/USD broke the 4-hour resistance marked by the series of 4-hour lows from last week’s business.
Prior analysis
''The price action in this current area can be monitored from a vantage point on the lower time frames for bullish structure and bullish technical conditions.''
Live market analysis
A retest of the prior highs on the 4-hour align perfectly with the 38.2% Fibonacci of this current bullish impulse where demand would be expected to support the upside bias.
On the upside, bulls will seek to replenish the weekly $28.75 highs.
A break there, however, will put the dynamic trend line support back under pressure and focus will be on $26.60 as the prior resistance structure.
Author
Ross J Burland
FXStreet
Ross J Burland, born in England, UK, is a sportsman at heart. He played Rugby and Judo for his county, Kent and the South East of England Rugby team.
