Silver Price Analysis: XAG/USD looks vulnerable, downside break of short-term trading range in play

• Silver price attracts some buyers during the Asian session on Thursday, although it lacks follow-through.
• The previous day’s sustained break through a short-term trading range favors the bears.
• Any subsequent upside move could attract fresh sellers and remain capped near the $31.00 level.

Silver (XAG/USD) price is moving higher during the Asian session on Thursday and is moving away from a two-week low around the psychological level of $30.00 touched the previous day. The white metal is currently trading around the $30.40 region, up nearly 0.35% on the day, although it lacks bullish conviction.

From a technical perspective, the recent failure to build momentum beyond the $31.40 resistance zone and the previous day’s breakout through a short-term trading range could be seen as a fresh trigger for the bears. That said, neutral oscillators on the daily chart warrant caution and make it prudent to wait for some follow-through selling below the $30.00 level before positioning for any further depreciating move.

The XAG/USD pair could then weaken further below the $29.70 horizontal zone and test the next relevant support near the $29.15 region. This is closely followed by the $29.00 level, which if broken decisively will expose the June monthly low, around the $28.60-$28.55 zone. The white metal could eventually drop to the 100-day simple moving average (SMA), currently located near the $28.00 round level.

On the contrary, any subsequent upside move is likely to face stiff resistance ahead of the $31.00 level. Sustained strength beyond it has the potential to push the XAG/USD back towards the $31.40 resistance zone. Some follow-through buying, leading to a subsequent move beyond the monthly high, around the $31.80 zone, should allow the bulls to retake the $32.00 level and challenge the yearly high, near the $32.50 zone touched in May.

Silver 4 hour chart