- Silver experiences renewed upward momentum, halting a three-day decline to its lowest level in several weeks.
- Prevailing bearish technical indicators suggest the potential for renewed selling pressure at higher price points.
- A definitive breakthrough above the $34.00 threshold is essential to invalidate the existing short-term negative outlook.
Silver (XAG/USD) is extending its modest recovery from the previous session’s low of $31.65, a level not seen in nearly three weeks, gaining further upward momentum during Friday’s Asian trading hours. The precious metal has rebounded to above the $32.50 mark in recent trading, appearing to interrupt a three-day sequence of losses. However, the current technical configuration advises caution before establishing positions anticipating further price appreciation. Investors are closely watching upcoming inflation data and central bank policy announcements that could influence silver’s trajectory.
The decisive breach below the 100-hour Simple Moving Average (SMA) observed overnight is considered a significant catalyst for bearish market participants. Furthermore, momentum oscillators on both the daily and 4-hour charts have been exhibiting increasing negative signals, indicating that the most probable direction for XAG/USD is downward. Consequently, any subsequent upward movements are likely to be perceived as opportunities to initiate short positions, potentially limiting further gains. Market analysts suggest that a resurgence in the U.S. dollar’s strength could further weigh on silver prices, adding to the bearish sentiment.
The $32.80 level is now expected to serve as an initial resistance barrier, preceding the psychological $33.00 level. Nevertheless, sustained buying interest could potentially trigger a wave of short covering, propelling XAG/USD towards the $33.70 resistance level. Beyond this lies the $34.00 mark, a decisive break above which would invalidate the prevailing short-term negative perspective and shift the market sentiment in favor of bullish investors. Traders should also monitor global economic indicators, as fluctuations in industrial demand can significantly impact silver’s price due to its use in various industrial applications.
