XAG/USD climbs to around $20.00, reversing much of Thursday’s fall



  • Silver is attracting new buying near the 50 DMA and reversing much of the losses overnight.
  • The technical setup remains tilted in favor of the bulls and supports the prospect for further gains.
  • A sustained break below $20.00 is needed to nullify the positive near-term outlook.

Silver is showing some resilience below the 50% Fibonacci retracement level of the drop from $22.52 to $18.15 and catching new offers near the $20.25 area, or SMA support 50 days Friday. The white metal hit a new daily high, around mid-$20.00 at the start of the North American session, reversing much of the previous day’s decline.

The emergence of new buying near a technically significant moving average suggests this week’s pullback from the 61.8% Fibo. The level has run its course and favors bullish traders. The constructive outlook is bolstered by bullish technical indicators on the daily chart, which are still far from overbought territory.

Therefore, further strength towards a retest of the weekly high, around the $20.85 region, now seems a distinct possibility. Some follow-on buying, leading to a breach above the $21.00 mark, would be seen as a new trigger for bullish traders and pave the way for further near-term appreciation for XAG/USD.

Spot prices could then accelerate momentum towards the $21.40-$21.50 intermediate resistance, above which XAG/USD could challenge the 100-day SMA, currently around the 21 region, $85. This is closely followed by the $22.00 mark and should be a significant hurdle.

On the other hand, the confluence of $20.35 to $20.25 includes the 50% Fibo. level and the 50 DMA, which in turn should continue to protect the immediate downside. The next relevant support is set near the psychological mark of $20.00. The latter should now act as a key pivot which, if broken decisively, would shift the bias in favor of bearish traders.

Silver daily chart

Key levels to monitor

Source link


Comments are closed.