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- Silver bears are taking a breather after their sharpest daily decline in three months.
- Key support lines from early 2021 to late 2020 call further downward movements into question.
- 50-DMA protects recovery movements, annual support in case of further weakness.
Silver (XAG / USD) is licking its wounds around $ 22.90 during Friday’s Asian session after falling the most in one day since mid-June the previous day.
Although the bearish MACD and continued trading below 50-DMA, coupled with the lack of an oversold RSI, keep silver sellers hopeful, an upward trend line from September 2020 and a downward sloping support line from January 2021 are challenging the price’s immediate decline.
Should commodity prices manage to stay below USD 22.90 and the support at USD 22.65 under pressure, the yearly low at USD 22.15 should return to the chart.
Thereafter, focus will be on the lows marked in November and September 2020 around USD 21.90 and USD 21.65, respectively.
Meanwhile, the corrective pullback needs to break the week’s low at $ 23.40 to consolidate recent losses.
Even so, the silver bulls remain concerned unless they see a clear upside break from the 50 DMA level at $ 24.40. During the recovery moves, $ 24.00 can serve as a buffer.
Silver: daily chart
Trend: further weakness expected
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