- Silver finds support near $22.00 and halts this week’s pullback from multi-month highs.
- The technical situation favors the bulls and supports prospects for further gains.
- A sustained break below $21.00 will undo the short-term uptrend in XAG/USD.
On Wednesday, the silver it attracted new buyers and got closer to $22.00 again during the European session.
On a bigger picture, this week’s sharp pullback from the highest level since late April stalls near $22.00. This zone coincides with the 200 hour SMA and should act as a turning point, which if broken decisively will set the stage for a deeper corrective fall.
The XAG/USD could then accelerate the fall towards the support zone of $21.40. This is closely followed by the important 200-day SMA, around the $21.30-$21.25 zone, and $21.00. The latter should act as a solid base for spot prices, which if broken decisively will nullify the positive outlook in the short term.
That being said, the oscillators on the daily chart are comfortably bullish and have once again gained positive traction on the hourly charts. This, in turn, supports the prospects for some buying to emerge at the lower levels, which should help limit any significant short-term decline in XAG/USD.
Meanwhile, any further move higher past the overnight high around the $22.60 zone is likely to face stiff resistance near the $23.00 signal. If the strength holds, XAG/USD should reach a multi-month high around the $23.50 $23.55 zone. A few follow-up purchases should pave the way for additional earnings.
The bulls could try to recapture $24.00 for the first time since April. The positive momentum could extend and lift XAG/USD further towards the next relevant hurdle around $24.25-$24.30 on the way to $24.55-$24.60.
Silver 1 hour chart
Key levels to watch
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.
