Silver (XAG/USD) experienced a slight rebound from its recent three-day low around $29.35 during Monday’s Asian session, finding support ahead of the 50-day Simple Moving Average (SMA). The white metal had previously retreated from the $31.00 mark, a two-week high reached last Friday, struggling to attract substantial buying interest.
Technically, XAG/USD is currently maintaining levels above key SMAs including the 50-day, 100-day, and 200-day, which typically favors bullish sentiment among traders. However, caution is warranted as daily chart oscillators are showing signs of entering negative territory, suggesting a potential need for prudence before anticipating further upward movement.
In terms of immediate price action, the 50-day SMA near the $29.15 level is likely to serve as initial support, protecting against downside risks before the psychological $29.00 mark. A decisive breach below this support could shift near-term sentiment in favor of bearish traders, potentially leading to a deeper decline towards support levels around $28.30-28.25, followed by a significant target near $28.00. Further downward momentum might extend towards the $27.55 support, with subsequent levels near the $27.00 round figure and the 100-day SMA around $26.90-26.85 coming into play.
On the upside, immediate resistance is expected at the psychological barrier of $30.00, followed by a broader resistance zone around $30.45-30.50. Breaking above these levels could open the door for a challenge towards the $30.70 supply zone. A sustained move beyond this zone might propel XAG/USD towards testing higher resistance near $31.00 and potentially reaching towards $31.35. Successful breaches above these levels could encourage bulls to target the $32.00 mark and retest the year-to-date peak established in May around $32.50.
In summary, while silver prices have shown resilience above key SMAs, the technical outlook suggests a cautious approach amid oscillating signals, with pivotal support and resistance levels dictating near-term market sentiment.
