Silver Price Analysis: XAG/USD climbs back closer to overnight peak, $19.00 remains in sight
- Silver edges higher for the second straight day, though remains below the $19.00 mark.
- The set-up warrants some caution for bulls and before positioning for any further gains.
- A sustained break below the $18.00 mark will be seen as a fresh trigger for bearish traders.
Silver gains traction for the second successive day on Tuesday and looks to build on its recent bounce from over a two-week low, around the $18.00 mark touched on Friday. The white metal, however, remains well within the previous day's broader trading range and below the $19.00 round figure.
Technical indicators on daily/4-hour charts - though have been recovering from the negative territory - are yet to confirm a bullish bias. Hence, it will be prudent to wait for a sustained move beyond the aforementioned handle before positioning for any further appreciating move. The XAG/USD might then accelerate the momentum towards the $19.70-$19.80 supply zone.
This is closely followed by the $20.00 psychological mark, which if cleared decisively will negate any near-term negative bias and trigger a fresh wave of the short-covering move. The subsequent move up has the potential to lift the XAG/USD further beyond the $20.50 intermediate hurdle, towards testing the $21.00-$21.10 barrier, or the 200-day EMA.
On the flip side, the Asian session low, around the $18.60 area now seems to protect the immediate downside. Any further decline could find support near the $18.00 mark, which should now act as a pivotal point. A convincing break below will make the XAG/USD vulnerable to retest the YTD low, around the $17.55 area, before dropping to the $17.00 mark.
Silver daily chart
Key levels to watch