- Silver attracts some buying on Thursday and turns positive for the second day in a row.
- The setup appears tilted in favor of the bulls and supports the prospects for additional earnings.
- A sustained break below the $ 22.25-20 soprote is needed to negate the bullish outlook.
Silver (XAG / USD) has reversed an intraday decline to the $ 22.90 zone and has once again approached the highs of almost a month touched the previous day. The white metal is trading near the $ 23.30 region, up around 0.80% on the day.
This region is close to a confluence hurdle comprising the 200-period SMA on the 4-hour chart and the 50% Fibonacci retracement of the $ 24.87-$ 21.42 dip. A sustained move above this region will be seen as a new trigger for the bulls and will set the stage for a further move higher in the near term.
Meanwhile, the technical indicators on the 1 hour chart maintain their bullish bias and have just started to gain positive traction on the daily chart. The setup looks firmly tipped in favor of the bulls and supports the prospects for an eventual breakout through the aforementioned confluence barrier.
XAG / USD could accelerate momentum towards the 61.8% Fibonacci, around the $ 23.55-60 area, before aiming to regain the $ 24.00 level. Some continuation purchases above the $ 24.25-30 region would expose the resistance of the September monthly highs near the $ 24.75-80 zone.
On the other hand, any significant drop below the round level of $ 23.00 could be seen as a buying opportunity and remain limited near the 38.2% Fibonacci, around the $ 22.75 region. That said, sustained weakness could accelerate the slide towards the static support at $ 22.25-20.
This last level coincides with the 23.6% Fibonacci, which if it breaks decisively will change the bias in favor of the bears. The XAG / USD could then become vulnerable to break below the $ 22.00 level and slide further towards the yearly lows, around the $ 21.45-40 region.
Silver 4 hour chart
Silver technical levels