- Silver regains positive traction following the previous day’s pullback from over one-week high.
- The technical setup favors bullish traders and supports prospects for further near-term gains.
- A break below a short-term descending channel support is needed to negate the positive bias.
Silver (XAG/USD) is exhibiting renewed strength during Thursday’s Asian trading session, effectively reversing a significant portion of the previous day’s decline from its highest level in over a week. The precious metal has ascended to approximately $33.00 within the last hour, indicating a potential for further upward momentum. Market participants are closely watching key economic indicators, including upcoming inflation data, which could influence the Federal Reserve’s monetary policy decisions and, consequently, silver prices.
From a technical analysis standpoint, the formation of a descending channel on shorter-term charts suggests the development of a bullish flag pattern. This pattern emerges against the backdrop of a notable recovery from the $28.45 region, which represents the year-to-date low recorded in April. Furthermore, oscillators on both daily and hourly charts are maintaining positions within positive territory, reinforcing the constructive near-term outlook for the XAG/USD pair. This technical configuration suggests that buying pressure could persist in the short term.
Nevertheless, a cautious approach is warranted, and it would be prudent to await a definitive breakout above the trend-channel resistance level, currently situated near $33.20, before establishing positions in anticipation of further gains. Should the XAG/USD successfully breach this level, the next target would likely be the $33.70 intermediate resistance point, followed by a potential move to reclaim the psychologically significant $34.00 level. Sustained buying activity beyond this point would serve as a fresh catalyst for bullish sentiment, potentially paving the way for further price appreciation. Conversely, failure to break above $33.20 could lead to a period of consolidation or a pullback towards support levels. Investors are also keeping an eye on movements in the US dollar and bond yields, as these factors often exert influence on precious metal prices.
