- Silver now appears to have entered a bullish consolidation phase near a two-week high.
- The bulls might wait for a sustained move beyond the $23.45 area before placing new bets.
- Weakness below the $23.00 mark could attract lower buying and remain limited.
Silver was seen hovering in a range around the $23.15-$23.30 region during the first half of the European session and consolidated its recent gains at a two-week high.
From a technical standpoint, XAG/USD, so far, has struggled to gain ground beyond the 100-day SMA resistance. It is closely followed by the horizontal resistance at $23.40-$23.45, which should now act as a pivot point for short-term traders.
The oscillators on the daily chart have only just begun to move into positive territory, although they have lacked momentum. Therefore, it will be prudent to wait for sustained strength beyond the aforementioned barrier before positioning for further gains.
XAG/USD could then accelerate the positive move and aim to recover the round figure of $24.00. The momentum could expand further and allow the bulls to challenge the year-to-date high around the $24.70 area hit on January 20th.
On the other hand, the $23.00 mark now appears to be protecting the immediate decline ahead of the overnight low around the $22.75 region and mid-$22.00. Some follow-on selling would negate the positive bias and leave XAG/USD vulnerable.
The next relevant support is set near the $22.00 mark, which if broken decisively will shift the bias firmly in favor of bearish traders. This, in turn, should pave the way for a slide towards the double bottom support, around the $21.40 area.
Silver daily chart
Levels to watch