- Silver traded largely defensively on Thursday, following a bearish breakout from a recent pennant structure.
- XAG / USD has dropped below $ 24.00 and is testing monthly lows above $ 23.20.
Pair prices XAG / USD have retreated in recent trade amid a recovery in the dollar, which has been fueled by mounting concerns about the worsening global economic outlook for the coming months, as the US and other countries face an increase in cases and closures due to Covid-19. XAG / USD is currently trading below $ 24.00 with losses for the day of just over 40 cents, or 1.8%.
XAG / USD sees a bearish breakout of the recent pennant, implying a possible further decline
As noted in yesterday’s article on silver, the precious metal had seen its price action compress into a pennant structure since the beginning of the month. During the Asia session on Thursday, there was a decisive downside breakout of the pennant support uptrend, with the commodity falling through previous weekly lows of $ 24.20 and then below the $ 24.00 level.
Silver also briefly broke below support in the form of the November 11 low of $ 23.78, but has since rallied above and is currently in a range between $ 23.80 and $ 24.00 for now. The next level of support on the downside is the November 9 low at just over $ 23.50, then the November 4 low at $ 23.22.
Conversely, if the bulls regain control, notable support to the upside comes in the form of previous weekly lows just above $ 23.20, as well as the 21- and 50-day moving averages at $ 24.34 and $ 24.56.
4 hour chart
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