- Silver is struggling to gain any significant traction and remains below the $19.00 level.
- The mixed oscillators on the hourly/daily charts warrant some caution for aggressive investors.
- A strength beyond $19.00 would suggest that XAG/USD has formed a bottom.
Silver was unable to take advantage of the previous day’s nice rebound from the $18.25 area, or a multi-day low, and remained below the $19.00 level during the European session on Friday.
Sustained strength beyond the aforementioned zone could trigger a new short-covering move and lift XAG/USD towards the strong horizontal resistance at $19.40-$19.50. Further buying would suggest that the white metal has formed a near-term bottom and would pave the way for a significant recovery from last week’s two-year low.
XAG/USD could reclaim the psychological level of $20.00. The momentum could extend further and push prices to the next relevant barrier near the $20.55-$20.60 zone. This region marks a strong breakout point of horizontal support and should act as a pivot point, which if broken through decisively would set the stage for further gains.
Positive technical indicators on the hourly charts support the prospects for some intraday gains. That said, the oscillators on the daily chart continue to remain in negative territory. This, in turn, warrants some caution for aggressive bulls and suggests that any significant move higher could attract fresh selling at higher levels.
On the other hand, the $18.50 horizontal zone seems to support the immediate drop ahead of the low around $18.25. This zone is closely followed by the yearly lows around $18.15 and the $18.00 level. A convincing break below this level would make XAG/USD vulnerable to an extension of the recent bearish trajectory.
The subsequent drop could drag prices towards the $17.45-$17.40 intermediate support on the way to the $17.00 level. The downtrend could extend further and XAG/USD could finally drop to test the next relevant support near the $16.70-$16.60 region.
Silver 4 hour chart
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silver key levels
Source: Fx Street
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