- Silver attracted purchases in the declines on Tuesday and recovered a significant part of the losses overnight.
- The setup remains tilted in favor of the uptrend and supports the prospects for additional earnings.
- Dropping below $ 25.00 could still be seen as a buying opportunity.
La plata (XAG) It regained positive traction on Tuesday and reversed a significant part of the overnight retracement slide from a high of more than three months. The white metal built on its steady intraday rise and climbed to a new daily high, around the $ 25.25 zone heading into the American session.
Looking at the bigger picture, the recent strong recovery from yearly lows, around the $ 21.40 zone touched in September, has been along an upward sloping channel. This points to a well-established short-term uptrend and supports the prospects for an extension of the appreciation move.
Aside from this, last week’s sustained breakout through the 100-day SMA / 38.2% Fibonacci – confluence barrier, the $ 24.50 supply zone adds credibility to the positive outlook. Furthermore, acceptance above the 50% Fibonacci level around the key psychological $ 25.00 level reaffirms the constructive setup for XAG / USD.
With oscillators on the daily chart staying in bullish territory and still far from being in the overbought zone, a further move towards the $ 25.55-60 zone, en route to $ 26.00, remains a clear possibility. The latter coincides with the 61.8% of the Fibonacci level and should act as a strong barrier.
On the other hand, any significant corrective pullback could continue to attract some buying on the dips near $ 25.00. This, in turn, should help limit the decline near the $ 24.50 resistance breakout point. Failure to defend the mentioned support could drag XAG / USD towards the round $ 24.00 level.
Daily Chart (XAG)
Technical levels
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