- Silver moves lower on Thursday and extends the previous day’s retracement from the $25.00 level.
- The setup favors the bears and supports the prospects for a further move lower.
- Sustained strength above the $26.00 level is needed to negate the short-term bearish bias.
Silver price (XAG/USD) remains under pressure during the early part of the European session on Thursday, now trading around the $24.75 region and down more than 0.50% on the day.
The previous day’s rejection near the 38.2% Fibonacci retracement of the move from $22.00 to $26.95 and the subsequent move lower favors the bears. Furthermore, the recent break of confluence support, comprising the 200-period SMA on the 4-hour chart and the lower end of an uptrend channel, adds credence to the negative outlook.
Furthermore, the technical indicators on the daily and 4-hour charts have just started turning into bearish territory and support the prospects for a further move lower in the near term. That said, investors are likely to wait for some continuation selling below the 50% Fibonacci around 24.50 before opening further bearish positions around XAG/USD.
The move lower could drag spot prices to challenge the 61.8% Fibonacci, around the $23.95-$23.85 region. Next, XAG/USD would turn vulnerable and extend the decline towards a test of the next relevant support around the $23.40-$23.35 region before finally falling to the $23.00 round level.
On the other hand, the Fibonacci 38.2% around the $25.05 area could continue to act as an immediate hurdle. Sustained strength above this level could allow XAG/USD to accelerate momentum and break through the intermediate hurdle of $25.40-$25.50. The up move could extend further towards the recovery of the $26.00 level.
Silver 4 hour chart
Silver technical levels
Source: Fx Street
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