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- Silver received new bids on Wednesday, jumping to over a week in the final hour.
- Any continued move past the $ 26.25-30 region could have set the stage for further gains.
- The $ 25.75-70 confluence support should now serve as a strong short-term base for the metal.
Silver regained positive traction on Wednesday, shooting to over a week highs during early North American trading session, closer to the middle of $ 26.00. This was the third day of positive move in the past four days and pushed the white metal crucially above the $ 26.25-30 supply zone.
The aforementioned hurdle coincided with the 50% Fibonacci level of the upside move from $ 23.78 to $ 28.75, and any sustained move above that could have already created the conditions for additional gains. The positive outlook is reinforced by the recent repeated recovery from the confluence region of $ 25.75-70.
The latter includes the very important 200-day SMA and the 61.8% Fibo. Level that should continue to be an important linchpin for short-term traders. This is followed by June swing lows around the middle of $ 25.00 which, if breached, will shift the bias in favor of bearish traders.
In the meantime, any significant pullback could continue to attract some buying near the $ 26.00 to $ 25.90 region. This, in turn, should help limit the downside move near the USD 25.75-70 confluence support, which should serve as a strong base for the XAG / USD, at least in the short term.
Meanwhile, the technical indicators on the daily chart have bounced back from negative territory but have yet to confirm a bullish bias. As such, any subsequent bullish move is more likely to encounter stiff resistance near the $ 26.75-80 region or monthly swing highs made last week.
This marks the 38.2% Fibo. Level that, if resolutely overcome, will pave the way for an expansion of the sustained positive dynamic. The XAG / USD could then attempt to break above the USD 27.00 mark and further accelerate the positive momentum towards the 23.6% Fibo. Level, about mid $ 27.00.
Silver daily chart
Technical levels to watch
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