- Silver prices gain ground for the second consecutive day and remain near a two-month high.
- The technical setup favors the bulls and supports the prospects for a further appreciating move.
- Any significant corrective drop could still be seen as a buying opportunity and remain limited.
Silver (XAG/USD) price is attracting buyers for the second consecutive day on Friday and is holding above the $31.00 level, close to a two-month peak during the first half of the European session.
From a technical perspective, the recent break of a short-term downtrend line around the $29.35 area, which coincided with the 100-day SMA, was seen as a fresh trigger for the bulls. Moreover, the emergence of some buying at lower levels on Thursday, coupled with positive oscillators on the daily chart, suggest that the path of least resistance for XAG/USD is to the upside.
The positive outlook is validated by the fact that the white metal now seems to have found acceptance above the $31.00 level. Therefore, a subsequent move beyond the intermediate $31.45 hurdle, en route to the July high around the $31.75 zone and the $32.00 level, seems a distinct possibility. The momentum could extend further and allow the XAG/USD to challenge a decade high around the $32.00 level by mid-May.
On the other hand, weakness below the $31.00 level now seems to find good support near the $30.70 horizontal zone. Any further dip could still be seen as a buying opportunity and remain capped near the $30.00 psychological level. Some follow-through selling could expose the breakout point of the $29.35 resistance confluence, now turned support, which should now act as a key short-term pivot point for the commodity.
A convincing break below it could accelerate the decline and drag the XAG/USD pair below the $29.00 level, towards the test of the next relevant support near the $28.20-$28.15 zone. This is followed by the $28.00 level and a strong horizontal support near the $27.70 area, or the monthly low, which if broken could shift the short-term bias in favor of the bears.
Silver daily chart
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
