- The price of Silver gains positive traction and breaks an eight-day streak of losses to two-week lows.
- The technical situation favors the appearance of new sales at higher levels.
- Bears could wait for a drop below the $22.85-$22.80 area before positioning for a further decline.
The price of Silver (XAG/USD) attracts some buyers on the first day of a new week, breaking an eight-day losing streak, and rises back above the $23.00 level at the start of the European session. However, the white metal remains very close to a two-and-a-half-week low around the $22.85-$22.80 area, which was retested on Friday, and still appears vulnerable to a further decline.
The negative outlook is reinforced by the fact that the oscillators on the daily chart have been gaining negative traction and are far from being in the oversold zone. Furthermore, the Relative Strength Index (RSI) on the 4-hour chart has also recovered from oversold. This, in turn, suggests that the path of least resistance for XAG/USD remains to the downside.
Therefore, any subsequent move higher could still be seen as a selling opportunity and remain capped near the very important 200-day SMA, currently fixed near the $23.45-$23.50 zone. It is followed by the 100-day SMA barrier, around the $23.80 area, and the $24.00 level, which if broken decisively will nullify the negative outlook for XAG/USD.
Further, possible short covering has the potential to lift the white metal above the $24.30-$24.35 zone, towards recovering the psychological level of $25.00. This level represents the August high and should act as a key point. Sustained strength above this point will be considered a new trigger for the bulls and will pave the way for a fresh appreciation move.
On the contrary, bears will have to wait for sales below the $22.85-$22.80 area before opening new positions. Then, XAG/USD could accelerate the decline below the $22.65-$22.60 support, towards challenging strong horizontal support near the $22.20-$22.10 zone. Next, the $22.00 level would confirm a new breakout.
Daily Silver Price Chart
Silver 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.
