- XAG/USD attracts new buying on Tuesday and reverses the previous day’s decline.
- The technical situation favors the bulls and supports the prospects for further increases.
- A move above a descending trend line is needed to reaffirm the positive outlook.
The price of Silver (XAG/USD) recovers ground on Tuesday to reverse the losses of the previous day and maintains its buying tone at the beginning of the American session. The white metal is currently trading around $23.95, up more than 2.10% on the day, and seems ready to continue appreciating.
From a technical point of view, the recent pullback from the $24.15 area, the highest level since September 4, stopped near the all-important 200-day SMA resistance breakout point, which has now become support. The subsequent move higher favors the bulls and supports the prospects of a new appreciation move. Furthermore, the daily chart oscillators remain in positive territory and are still far from the overbought zone, validating the positive outlook for XAG/USD.
Bulls, however, could wait for a sustained break through a downtrend line extending from the May high, currently near the $24.00 level, before opening new positions. Then, XAG/USD could try to overcome the intermediate resistance of $24.20-$24.25 and make a new attempt to conquer the psychological level of $25.00. Some continuation buying above the $25.15-$25.20 area should set the stage for reclaiming the round $26.00 level for the first time since May.
On the other hand, the 200-day SMA, currently in the $23.30 area, could continue to protect the immediate decline. Any further pullback could be seen as a buying opportunity and remain capped near the $23.00 level. That said, a convincing break below this last level could trigger aggressive technical selling and drag XAG/USD towards the $22.35-$22.30 area en route to the $22.00 level.
Daily Silver Price Chart
Additional technical levels
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.
