XAG / USD falls to lows of more than a week around $ 25.50

• XAG / USD finds new selling on Monday and confirms the breaking of an ascending wedge.
• The white metal now appears vulnerable to testing monthly lows before falling to the support of the 200-day SMA.

Silver has seen strong selling on the first day of a new trading week and has fallen to lows of more than a week, around $ 25.50 at the start of the European session.

The sharp decline has dragged XAG / USD below confluence support near the $ 26.00 level, which in turn could have prompted some aggressive technical selling. The mentioned level comprised the 200 hourly SMA and a short-term uptrend line, which formed the formation of a bearish rising wedge on the 1 hour chart.

A convincing breakout of the pattern support has marked a bearish breakout and could have set the stage for a further downside move in the short term. The bearish outlook is reinforced by the fact that the oscillators on the hourly / daily charts have been gaining ground to the downside and are still far from being in the oversold zone.

Some continuation weakness below the 61.8% Fib retracement of the recent positive move from $ 24.92 to $ 26.64 will reassert the bearish bias and make the XAG / USD vulnerable to further decline. The next relevant bearish target is near the $ 25.20-15 region before targeting the monthly lows, around the $ 24.80-85 region touched on March 5.

The downward movement could extend further to challenge the very important support of the 200-day SMA, around $ 24.00. The XAG / USD could finally fall to retest the yearly lows near the round level of $ 24.00.

On the other hand, the breakout point of the confluence support at $ 26.00 could now act as a strong resistance. Any attempt to recover above this level could be seen as an opportunity to initiate new bearish positions. This, in turn, should limit any further gains for the XAG / USD near the strong resistance zone at $ 26.30-35.

Silver 1 hour chart

Silver technical levels