XAGUSD pares intraday losses to weekly lows and defends $21.00 level

  • Silver falls to a weekly low on Thursday but finds support ahead of $21.00.
  • The mixed technical setup warrants some caution before placing aggressive directional bets.
  • A convincing break below $21.00 is needed to support the prospects for more losses.

Silver extends this week’s retracement slide from above a five-month high and remains under some selling pressure for the third straight day on Thursday. However, the white metal is finding some support pre-$21.00 and clawing back some of its intraday losses to a one-week low. XAGUSD is steadily jumping into the $21.35-$21.40 region during the early European session, although it is lacking a breakout and still appears vulnerable.

Repeated failure to find acceptance above the round figure of $22.00 and a subsequent drop below the 200 hourly simple moving average suggest that the recent rally may have run out of steam. A sustained break below $21.00 will confirm the negative bias and open the way for a slide towards the next relevant support near the $20.40-$20.35 region. The corrective decline could be extended and drag spot prices to the psychological $20.00 level.

However, the oscillators on the daily chart, despite having pulled back, are still comfortably staying in the bullish territory. This could discourage traders from placing aggressive bearish bets around XAGUSD and help limit deeper losses, at least for now.

Meanwhile, strength on the upside beyond the $21.40-$21.50 immediate hurdle could attract some sellers near the $21.70 horizontal barrier and remain limited around the $22.00 round mark. This is followed shortly by the multi-month high around the $22.25 region which, if cleared, will set the stage for additional gains. XAGUSD could then accelerate momentum towards the $22.50-$22.60 supply zone and eventually reclaim the $23.00 level.

Silver 1 hour chart

Important levels to see

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