Silver Price Analysis: XAG/USD bulls await a move beyond 50% Fibo., around $25.00 mark
- Silver regained positive traction on Thursday and was seen flirting with multi-month tops.
- The bias seems tilted in favour of bullish traders and supports prospects for further gains.
- Any corrective pullback would now be seen as a buying opportunity near mid-$24.00s.
Silver inched back closer to over three-month tops set on Wednesday, with bulls making a fresh attempt to build on the momentum beyond the key $25.00 psychological mark. The mentioned handle coincides with the 50% Fibonacci level of the $28.75-$21.42 downfall, which if cleared decisively will set the stage for additional gains.
Given this week's bullish breakout through the 100-day SMA/38.2% Fibo. confluence hurdle, the overnight sustained strength beyond mid-$24.00s favours bullish traders. The near-term positive outlook is reinforced by bullish technical indicators on the daily chart, which are still far from being in the overbought territory.
That said, bulls might still wait for a sustained strength beyond the 50% Fibo. level before positioning for any further appreciating move. The XAG/USD might then accelerate the momentum towards the next relevant hurdle near the $25.55-60 region before aiming to test the 61.8% Fibo. level, around the $26.00 round-figure mark.
On the flip side, any meaningful corrective pullback now seems to attract some dip-buying near the $24.50 resistance breakpoint. This, in turn, should help limit the downside near the $24.00 confluence area, which should now act as a strong base for the XAG/USD and a key pivotal point for short-term traders.
Some follow-through selling below the $23.70 area could shift the bias in favour of bearish traders and turn the XAG/USD vulnerable to extend the fall towards the $23.00 mark. The next relevant support is pegged near mid-$22.00s, which if broken could drag the metal back towards YTD lows, around the $21.40 area touched in September.
Silver daily chart
Technical levels to watch