Silver Price Analysis: XAG/USD Bulls Expect to Break Downtrend Line

• Silver price fails again at multi-month downtrend line resistance.
• The technical setup favors the bulls and supports the prospects for an eventual breakout.
• A weakness below the $18.80-$75 area is necessary to nullify the short-term positive bias.

Silver price (XAG/USD) meets fresh selloff on Tuesday and remains on the defensive at the start of the European session. The white metal is currently trading near the daily low, just below $19.00.

From a technical point of view, XAG/USD has been trading in a known range for the past week. Ranged price action points to indecision among traders about the next directional move. Furthermore, the upside remains capped by the resistance of a descending trend line that extends from the May high.

The aforementioned barrier around the $19.75 area should act as a key point and help determine the short-term path of XAG/USD. A convincing breakout will be seen as a new trigger for the bulls and will set the stage for an extension of the recent recovery from the more than two-year low in the $17.55 region touched earlier this month.

As the oscillators on the daily chart remain slightly uptrend, XAG/USD could aim to break above the psychological $20.00 level and test the 100-day SMA near the $20.25 zone. Some follow through has the potential to lift silver prices past the $20.50 intermediate hurdle, towards the $21.00 level.

On the other hand, the $19.00 level could defend the immediate drop ahead of the $18.80-$18.75 zone, which if broken decisively will turn the short-term trend in favor of the bears. XAG/USD could then accelerate down to the $18.45-$18.40 support before finally falling to the $18.00 round level.

silver daily chart

silver key levels