- Silver regains positive traction and halts a two-day correction from a more than one-month high.
- The technical setup warrants some caution before positioning for a further intraday bullish move.
- A breakout of a short-term trading range is needed to confirm the short-term direction.
Silver (XAG/USD) is attracting some buying during the Asian session on Tuesday, snapping a two-day losing streak and halting the recent pullback from the $31.75 area or its highest level since May 31 hit last week. The white metal is currently trading around the $30.80-$30.85 region, up 0.45% on the day, and the bulls now await a sustained move beyond the 200-hour simple moving average (SMA) before positioning for further gains.
Looking at the bigger picture, the XAG/USD remains confined within a multi-day trading range. Moreover, neutral technical indicators on the 1-hour chart warrant some caution before positioning for a firm intraday direction. Meanwhile, oscillators on the daily chart remain in positive territory and suggest that the path of least resistance for the commodity is to the upside. That said, a convincing break below the short-term trading range support near the $30.40-$30.35 zone will be considered a fresh trigger for the bears and pave the way for deeper losses.
The XAG/USD pair could then accelerate the decline and weaken further below the psychological level of $30.00, towards testing the next relevant support near the horizontal zone of $29.75. The downward trajectory could further extend towards the intermediate support near the $29.40 region en route towards the round figure of $29.00 and the monthly low of June, around the $28.55 zone.
Conversely, any further upside move is likely to face some resistance near the $31.00 level, which represents the upper end of the trading range. Acceptance above the said level will suggest that the correction is over and pave the way for a move towards the $31.30 hurdle before the XAG/USD pair eventually rises to the monthly high, around the $31.75 region. The momentum could further extend towards reclaiming the $32.00 level for the first time since May 30.
Silver 1 hour chart
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.
