XAG / USD consolidates in a range above $ 25.00, bearish bias intact

• Silver remains confined to a four-day trading range above $ 25.00.
• The formation of a rectangle could be seen as a bearish continuation pattern.
• Any recovery attempt is likely to remain limited near the $ 25.65-70 region.

At payment it extended its side consolidation price action and remained confined to a narrow trading band, above the key psychological level of $ 25.00 heading into the American session.

Looking at a slightly larger image, the XAG / USD it has been swinging in a range for the last four trading sessions. This constitutes the formation of a rectangle on intraday charts. Given last week’s sustained break below the 200-day SMA support near the $ 25.70-65 area, the rectangle could still be classified as a bearish continuation pattern.

The negative outlook is reinforced by the fact that the technical indicators on the daily chart remain in bearish territory. This, coupled with the emergence of new selling near the support break point of the previous monthly lows, around $ 25.50, favors bearish traders and supports the prospects for a further short-term depreciation move.

Therefore, a subsequent decline to challenge the recent lows, around the $ 24.75 zone, remains a clear possibility. Some subsequent selling will be seen as a new trigger for bearish traders and will make XAG / USD vulnerable to accelerate the decline further towards $ 24.00, en route to yearly lows around the $ 23.80-75 zone.

On the other hand, the attempt to move up could continue to face strong resistance near the $ 25.50 zone. Any subsequent strength could be seen as a selling opportunity and risks rapidly fading near the $ 25.70-65 region (200 DMA), which should now act as a fundamental point for short-term traders.

4 hour chart Silver

Technical levels