Silver Price Analysis: XAG/USD bulls look to break through strong resistance at $19.00

• The price of silver rises for the second consecutive day and moves away from the low of two years.
• The situation favors the bears and supports the possibility of further selling.
• Sustained strength above the $19.50 area is needed to negate the short-term negative bias.

Silver gains some positive traction for the second day in a row on Monday and pulls away from the two-year low around the $18.15 region touched last week. The white metal maintains its modest gains during the early European session and is now trading just below $19.00.

From a technical point of view, the $18.90-$19.00 zone represents a short-term range breakout and now coincides with the 50-period SMA on the 4-hour chart. Sustained strength above this region could trigger a short-covering move and lift XAG/USD back towards the $19.45-$19.50 resistance zone.

The technical indicators on the daily chart have just recovered from the oversold zone, although they remain in bearish territory. This, in turn, suggests that the attempted rally towards the aforementioned barrier could still be seen as a selling opportunity and fade quickly.

On the other hand, the horizontal zone of $18.50 seems to protect the immediate fall before the yearly low, around the $18.15 zone. This zone is closely followed by the $18.00 level, which if broken decisively would be seen as a new trigger for the bears and pave the way for further losses.

XAG/USD could then accelerate the decline towards the $17.45-$17.40 intermediate support heading towards the $17.00 level. The bearish trajectory could extend further and drag silver prices towards the next relevant support near the $16.70-$16.60 region.

Silver 4 hour chart

Silver key levels to watch