XAG / USD bulls expect sustained move above $ 27.00

• Silver drew some buying in the dips on Tuesday and held steady near two-month highs.
• The technical setup favors bullish traders and supports the prospects for additional earnings.
• Only a sustained break below $ 26.00 will negate the constructive outlook.

At payment it reversed an intraday drop to the $ 26.70 region and updated daily highs during the early days of the American session. The white metal was last seen hovering around the two-month highs, with the bulls expecting a sustained move past $ 27.00.

From a technical perspective, the sustained overnight move past the $ 26.50-60 supply zone confirmed a short-term bullish breakout. This, along with the appearance of some buying in the dips on Tuesday, supports the prospects for additional short-term gains.

Meanwhile, the technical indicators on the daily chart maintained their bullish bias and are still far from being in overbought territory. This further validates the constructive setup and a possible move to the next hurdle near $ 27.00.

Some subsequent buying should pave the way for an extension of the recent bounce from the yearly lows and help the XAG / USD bulls target for a recovery to $ 28.00. This is followed by resistance near the $ 28.30-35 region.

On the other hand, the resistance break point of $ 26.60-50 now appears to protect the immediate drop. Any further pullback could now be seen as a buying opportunity near the $ 26.30-25 zone. This, in turn, should help limit the decline near the $ 26.00 level.

A convincing advance from the aforementioned support levels will negate the positive outlook and trigger some aggressive technical selling. The XAG / USD could become vulnerable to accelerate the decline and challenge the psychological level of $ 25.00.

Daily chart

Technical levels