- Silver has been oscillating between two converging trend lines, forming a bearish wedge.
- Pattern support coincides with the 200 hourly simple moving average and should act as a key fundamental point.
Silver is moving lower on the last trading day of the week, staying close to the daily lows, around the $ 26.00 level. That said, the white metal has, so far, managed to stay above the support of the 200 hourly SMA, although the short-term bias appears to be leaning in favor of the bears.
Recent price movements have been confined between two converging upward sloping trend lines. This constitutes the formation of a bearish rising wedge pattern and supports the prospects for further weakness. The pattern’s support, currently around the $ 26.00-25.90 region, coincides with the 200 hourly SMA and should act as a fundamental point. A convincing break below this region will mark a further bearish breakout and trigger some aggressive selling.
The XAG / USD could then accelerate the decline towards intermediate support near the $ 25.40-35 zone, on its way to the key psychological level of $ 25.00. This is followed by the monthly lows, around the region of $ 24.85. Some subsequent selling should pave the way for an extension of the recent strong pullback from the $ 30.00 level and drag the XAG / USD towards the very important 200-day SMA, currently near the round $ 24.00 level.
On the other hand, any significant positive movement could still be seen as a selling opportunity and face stiff resistance near the $ 26.50-60 region. The mentioned barrier coincides with the upper end of the wedge pattern, which if it breaks decisively will negate the bearish bias. The subsequent short hedging move has the potential to lift XAG / USD above the $ 27.00 level, towards the next relevant hurdle near the $ 27.30 resistance zone.
Silver 1 hour chart
Silver technical levels
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