Technical Analysis – Silver bulls roar back; meet key resistance



Silver staged an exciting rally to re-enter the 22.00 region on the back of Powell’s dovish tone on Wednesday.

The 50% Fibonacci retracement of the 26.93-17.54 downtrend at 22.25 is again under the spotlight, pushing the market back to losses after the pickup to a new high of 22.39 early on Thursday. Yet, the bulls may have some extra fuel in the tank according to the RSI and the MACD. The former has recently recouped some ground above its 50 neutral mark, while the latter keeps gaining positive momentum, currently set to climb above its red signal line.

If the wall at 22.25 collapses, the bulls will gear up for the 23.00 psychological mark. Breaching the latter, the rally could continue towards the 61.8% Fibonacci of 23.95.

In the event of a downside reversal, the price may initially seek support between 21.60 and 21.35, where the 20- and 200-day simple moving averages (SMAs) are placed. The 38.2% Fibonacci of 21.12 may cement that floor, delaying an extension to the previous low of 20.56. Otherwise, the decline could stretch towards the 50-day SMA, bringing the 23.6% Fibonacci of 19.75 in sight too.

In short, silver is currently testing an important resistance region at 22.25, a break of which is required to activate fresh buying.

Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.

All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.

Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.

We are using cookies to give you the best experience on our website. Read more or change your cookie settings.

Risk Warning: Your capital is at risk. Leveraged products may not be suitable for everyone. Please consider our Risk Disclosure.