[ad_1]
- Silver gained positive traction for the third consecutive year on Monday.
- Any subsequent bullish move could encounter resistance near the 38.2% Fibo. Level.
- Mixed technical indicators on the daily chart warn bullish traders to be cautious.
Silver added post-NFP gains and rose for the second straight year on Monday. It was also the third day of positive move in the past four days, pushing the white metal to over two-week highs around the $ 26.60-65 region in the first half of the European session.
Given Friday’s sustained move beyond the strong supply zone of $ 26.30 or the 50% Fibonacci level of the move higher from $ 23.78 to $ 28.75, the momentum could be attributed to some technical buying. This could also have created the conditions for the sustained appreciation movement to extend in the face of subdued USD demand.
Meanwhile, although the technical indicators on the daily chart have bounced back from negative territory, they have yet to confirm a bullish bias. Hence, any subsequent upward move is more likely to encounter stiff resistance and remain capped near the 38.2% Fibo. Level, roughly in the range of $ 26.85.
This is followed by the USD 27.00 mark, above which a new burst of short coverage has the potential to further lift the XAG / SUD towards the 23.6% Fibo. Level hurdle near $ 27.00.
On the flip side, the resistance breakpoint of $ 26.30 (50% Fibo. Level) is now becoming an immediate support to defend from the $ 26.00 level. A convincing break on the downside will shift the near-term bias in favor of bearish traders, leaving the XAG / USD vulnerable to break the $ 25.70 confluence support.
The mentioned region includes the very important 200-day SMA and the 61.8% Fibonacci level of the $ 23.78-28.75 move higher. Some follow-up sales below the $ 25.00 mid-point will reinforce the bearish outlook and pull the XAG / USD back towards the key psychological level of $ 25.00.
Silver daily chart
Technical levels to watch
[ad_2]
