- Silver drifts lower for the second straight day and drops to a fresh weekly low.
- Break below 50 DMA and the $19.00 mark supports prospects for further losses.
- A breakout through a descending trend-line is needed to negate the negative bias.
Silver remains under some selling pressure for the second straight day on Friday and drops to a fresh weekly low during the first half of the European session. The white metal is currently trading just below the $19.00 mark, down over 1% for the day.
Looking at the broader picture, the recent recovery from over a two-year low, the $17.55 area faltered near a descending trend-line resistance earlier this week. A subsequent slide below the 50-day SMA and the $19.00 round figure suggests that the corrective bounce might have already run out of steam. Moreover, technical indicators on the daily chart, so far, have been struggling to gain any meaningful traction and are placed in negative territory. This further adds credence to the near-term bearish outlook and supports prospects for some meaningful near-term depreciating move for the XAG/USD.
From current levels, the $18.45-$18.40 region could act as strong immediate support. A convincing break below will make the XAG/USD vulnerable to accelerating the fall towards the $18.00 mark. Bears might eventually aim to challenge the YTD low, around the $17.55 area touched earlier this month.
On the flip side, momentum back above the $19.00 mark now seems to confront resistance near the $19.25 region (50 DMA). Sustained strength beyond might trigger a short-covering rally and has the potential to lift the XAG/USD towards the next relevant hurdle, around the $19.65-$19.75 supply zone. The latter now coincides with a descending trend-line barrier extending from May monthly swing high. This is closely followed by the $20.00 psychological mark, which if cleared decisively will be seen as a fresh trigger for bullish traders and pave the way for some meaningful appreciating move.
Silver daily chart
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Key levels to watch
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