Silver Price Analysis: XAG/USD flirts with uptrend line support and 200 hour SMA

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  • Silver comes under some selling pressure on Friday, although the fall remains supported.
  • The technical setup supports the possibility of some buying at lower levels.
  • A sustained break below trend line support will negate the positive outlook.

Silver (XAG/USD) is moving lower on Friday and moving away from a 1-week high around the $21.65 to $21.70 zone that was hit on Thursday. The white metal remains on the defensive during the European session and currently sits just below $21.00.

From a technical point of view, XAG/USD has, so far, managed to defend the 200 hour SMA. Against the backdrop of a convincing break above a week-long descending resistance line (orange) on Wednesday, the setup favors the bulls and supports prospects for further appreciation in the near term.

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This constructive outlook is reinforced by the fact that the oscillators on the daily chart remain in bullish territory. However, the technical indicators on the 1 hour chart have just started to gain negative traction and warrant some caution amid relatively poor liquidity conditions in the markets.

However, XAG/USD looks set to break above the previous day’s high, around the $21.65-$21.70 area, and recapture the $22.00 level. This is followed by a five-month high around the $22.25 area, above which XAG/USD could rally to the $22.50-$22.60 area en route to the round $23.00 level.

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On the other hand, the $21.00 level could act as immediate support before a rising trend line support, currently around the $20.80 area. A convincing break below this last level could nullify the positive outlook and possibly shift the short-term bias in favor of the bears.

XAG/USD could then accelerate the decline to the $20.60 to $20.55 zone (weekly low) before finally falling to challenge the psychological $20.00 level. Some continuation selling could expose the $19.00 level, with intermediate support near the $19.65 to $19.60 region.

Silver 1 hour chart

fxoriginal

silver key levels

XAG/USD

Overview
Last price today 21.36
today’s daily change -0.14
today’s daily change -0.65
today’s daily opening 21.5
Trends
daily SMA20 20.8
daily SMA50 19.92
daily SMA100 19.58
daily SMA200 21.38
levels
previous daily high 21.68
previous daily low 21.46
Previous Weekly High 22.25
previous weekly low 20.75
Previous Monthly High 21.24
Previous monthly minimum 18.09
Fibonacci daily 38.2% 21.54
Daily Fibonacci of 61.8% 21.6
Daily Pivot Point S1 21.41
Daily Pivot Point S2 21.33
Daily Pivot Point S3 21.19
Daily Pivot Point R1 21.63
Daily Pivot Point R2 21.76
Daily Pivot Point R3 21.85

Source: Fx Street

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