• Over a one-week high, silver regains positive momentum and reverses a portion of Friday’s pullback.
  • The technical configuration continues to be bullish and bolsters expectations for further gains.
  • A convincing break below an ascending trend line that has been in place for several months would render the optimistic outlook null and void.

On the first day of a new week, silver (XAG/USD) experiences dip purchasing near the $23.70 region and continues its steady intraday ascent into the European session. The price of the white metal has risen to $24.00 in the past hour and appears poised to build on its recent strong rebound from the mid-$22.00s, which was its lowest level in nearly a month and was reached last week.

Last week, the XAG/USD demonstrated some technical resilience below and defended a trend line that extends upwards from the October swing low. Bullish traders are aided by the subsequent recovery and approval of the price above the critical 200-day Simple Moving Average (SMA). Additionally, daily chart oscillators have recommenced acquiring positive momentum and providing support for the possibility of a further upward trend.

However, prior to placing new wagers, bulls might wait for follow-through purchasing above the $24.25-$24.30 region, which is above the one-week high established on Friday. The XAG/USD could then attempt to reclaim the psychological $25.00 level. The ascent may surpass the $25.25 intermediate barrier and continue towards the $25.45-$25.50 region before reaching the $26.00 area, which represents the highest level since May 5 that was reached earlier this month.

Conversely, investors may remain interested in a significant decline in value in the vicinity of the 200-day SMA, which is presently situated around $23.55 area. However, some follow-through selling could render the XAG/USD susceptible to further declines towards the $23.00 level. The latter is in close proximity to the previously mentioned ascending trend-line support, which, should it be decisively breached, would invalidate the positive prognosis and turn the tide in favor of bearish traders.

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