- The price of Silver encounters fresh selling on Tuesday and falls close to last week's low.
- The technical setup suggests that the path of least resistance for XAG/USD is to the downside.
- A sustained break below the 38.2% Fibonacci retracement will reinforce the negative near-term outlook.
The price of Silver (XAG/USD) suffers some selling on Tuesday and remains under pressure near $24.50 during the first half of the European session. Meanwhile, the technical setup appears to be tilting in favor of the bears and supports prospects for an extension of last week's sharp pullback from the $25.75-$25.80 region, or its highest level since early December.
XAG/USD appears to have now found acceptance below the $24.85-$24.80 horizontal support, which coincides with the 23.6% Fibonacci retracement of the February-March move. However, the subsequent decline stopped near the $24.40 area, just ahead of the 38.2% Fibonacci, which should now act as a pivotal point. Meanwhile, the mixed oscillators on the daily chart make it prudent to wait for selling below that support before positioning for additional losses.
XAG/USD could then accelerate the corrective decline towards the round $24.00 level before falling to the 50% Fibonacci support, around the $23.85 region. Below is the confluence of $23.35, which comprises the 61.8% Fibonacci and the all-important 200-day Simple Moving Average (SMA). A convincing break below the latter will be considered a new trigger for the bears and will drag the white metal below the $23.00 level, towards the next relevant support near the $22.45 region.
On the other hand, any recovery attempt would attract new sellers and remain limited near the psychological barrier of $25.00. That said, sustained strength above that zone could trigger a short-covering rally and lift XAG/USD to the $25.50 zone en route to the yearly high, around the $25.75-$25.80 zone. This is followed by the December 2023 high, just ahead of the round $26.00 level, which if broken decisively will set the stage for a new near-term appreciation move.
Daily Silver Price Chart
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
