Silver Price Analysis: XAG/USD bulls await a sustained move beyond 61.8% Fibo. level

Silver continued with its struggle to capitalize on the move beyond the 61.8% Fibonacci level of the $30.07-$23.78 downfall and trimmed a part of its intraday gains to one-week tops. The commodity was last seen trading around the $27.60-65 region, still up nearly 1.0% for the day.

Looking at the broader picture, the recent strong recovery from YTD lows, around the $23.80-75 region touched on March 31 has been along an upward sloping channel. This points to a well-established bullish trend and supports prospects for a further appreciating move for the XAG/USD.

The constructive set-up is reinforced by the fact that oscillators on hourly/daily charts have been gaining positive traction and are still far from being in the overbought territory. That said, bulls might still wait for a move beyond the $27.75-80 region before placing fresh bets.

The mentioned barrier is closely followed by the $28.00 round-figure mark, which if cleared decisively will reaffirm the bullish outlook. The XAG/USD might then accelerate the momentum further towards testing the $28.25-30 supply zone, which coincides with trend-channel resistance.

Some follow-through buying will mark a fresh breakout and set the stage for additional gains towards reclaiming the $29.00 mark in the near term.

On the flip side, any meaningful pullback might continue to attract some dip-buying and remain limited near the $27.00-$26.90 confluence support. This comprises the lower boundary of the ascending channel and 50% Fibo. level, which if broken will negate the positive bias.

The subsequent selling pressure has the potential to drag the XAG/USD further towards the $26.15-10 area (38.2% Fibo.) en-route the $26.00 mark. Some follow-through selling will expose the $25.00 psychological mark, with some intermediate support near the $25.30-25 zone (23.6% Fibo.).

XAG/USD daily chart

Technical levels to watch