Silver Price Analysis: Bulls have the upper hand over the $21.65-70 confluence.

Despite being in a trading range that has been in place for some days, silver gained momentum on Friday. Acceptance over the $21.65–21.70 intersection raises the possibility of further gains. A decisive break below the $21.00 level is required to counter the near-term optimistic tendency.

On the last day of the week, silver draws new purchasing and keeps up its bid tone through the first part of the European session, but it finds it difficult to profit from the rise over the $22.00 round-figure level.

Technically speaking, a rectangle has formed due to the recent sessions’ two-way price movements inside a well-known range. This is still considered a bullish consolidation phase given the recent robust rebound from sub- $ 20.00 levels or a four-month low recorded last week. Acceptance over the $21.65–21.70 confluence further strengthens the favorable view and raises the possibility of another short-term upward movement for the XAG/USD.

The region, as mentioned above, consists of the 38.2% Fibonacci retracement level of the decline from the $24.65 area, or a multi-month high reached in February, and the 200-period Simple Moving Average (SMA) on the 4-hour chart. The XAG/USD should now benefit from this acting as a firm foundation and assist limit the immediate drop. The optimistic outlook, however, might be negated by any follow-through selling that results in a breach below the trading range support at the mid-$21.00s, opening the door for a decline below the $21.00 level.


The latter is also the 23.6% Fibo level, and if it is forcefully violated, bearish traders will again have the upper hand in the short term. On its way to the $20.00 psychological level, the XAG/USD may become susceptible and decline faster into the intermediate support area between $20.55 and $20.50. Spot prices may continue downward until they reach the next important support level, close to the $19.60 area. Eventually, the price of silver may fall below $19.00 for the first time since early November 2022.

The 50% Fibo level and the overnight swing high are at the $22.25-$22.35 range, where momentum over the $22.00 round number can encounter strong resistance. The continuing move higher might drive the XAG/USD over the $22.55-$22.60 supply zone towards challenging the 61.8% Fibo. Level, just ahead of the $23.00 mark. A sustained rise over the latter will be a new catalyst for optimistic traders. It should open the door for the silver to experience a considerable upside shortly.

4-hour silver chart

Source: FX Street