- Silver rose for the third consecutive session, although it lacked follow-up.
- The bulls struggled to find acceptance or take advantage of momentum beyond $ 28.00.
- The setup supports the prospects for a bullish breakout in the recent trading range.
At payment it built on the previous session’s good bounce from week-long lows and gained some traction on the first day of a new trading week. This marked the third day in a row of a rally, as the bulls struggled to find acceptance above $ 28.00 or capitalize on the move.
Looking at the broader technical picture, XAG / USD has been swinging in a range for the last two weeks or so. Recent price movements constituted the formation of a rectangle, marking a consolidation phase and pointing to indecision about the next leg of the directional movement of the white metal.
Meanwhile, bullish technical indicators on the daily / hourly charts support the prospects for an eventual breakout to the upside. That said, it will still be prudent to wait for some subsequent purchases beyond the $ 28.25 / 30 supply zone before positioning for any short-term appreciation moves.
The next relevant hurdle is tied to the May monthly swing highs around the $ 28.75 region, above which the XAG / USD appears poised to break above the $ 29.00 level. Momentum could extend further towards an intermediate hurdle near $ 29.50 en route to the key psychological level of $ 30.00.
On the other hand, any significant drop could continue to attract some buying on the dips near $ 27.00. This, in turn, should help limit the decline near the trading range support, around the $ 27.25-20 region, which if decisively broken could shift the bias in favor of bearish traders.
The subsequent sell below $ 27.00 would make XAG / USD vulnerable to accelerate the decline towards $ 26.50 before falling to the support zone from $ 26.10 to $ 26.00.
4 hour chart