Silver Price Forecast: XAG/USD’s Struggle Continues
XAG/USD is moving in a downward direction within a multi-week-old trading range, below the 20-day SMA.
- Silver continues to experience selling pressure for the second consecutive day.
- The presence of a rectangular pattern indicates uncertainty regarding the next potential direction.
- From a technical perspective, this configuration Favours bearish traders and suggests the possibility of further declines.
Silver, represented as XAG/USD, continues its decline for the second consecutive day after facing a rejection near the crucial 200-day Simple Moving Average (SMA). The downward momentum gained strength during the early European session, pushing the white metal to a two-day low, approximately around the $22.75-$22.70 range.
Taking a broader perspective, XAG/USD has been stuck in a well-defined range for about three weeks, forming a rectangular pattern on the daily chart. This pattern signifies uncertainty among traders regarding the next potential price direction. Nevertheless, recent repeated failures to sustainably breach the technically important 200-day SMA and resistance around the $23.60-$23.70 zone favour bearish traders.
Attention turns towards Jerome Powell’s speech scheduled for Wednesday as investors look for additional insights regarding the Federal Reserve’s December meeting. Following last week’s meeting, there is a prevailing market sentiment that the Fed won’t implement further interest rate hikes in 2023. Nevertheless, Powell’s assessment of the recent job reports data, which suggested a slowdown in the labour market, will play a crucial role in shaping expectations for future decisions.
SILVER TECHNICAL ANALYSIS DAILY CHART:
Technical Overview
Silver is currently trading within a down channel.
Silver is positioned below all Moving Averages (SMA).
The Relative Strength Index (RSI) is in a negative zone, while the Stochastic oscillator suggests a negative trend.
Immediate Resistance level: 23.30
Immediate support level: 22.50
HOW TO TRADE SILVER
Silver’s price initially saw a notable daily increase, forming a double-top pattern, which subsequently led to a decline. Following this, silver continued to trend lower until it encountered a level of support, prompting a brief upward reversal that couldn’t be sustained. At present, the silver price is positioned within a critical support zone, and a breach of this level could indicate the potential for further declines.
TRADE SUGGESTION- STOP SELL – 22.29, TAKE PROFIT AT- 21.21, SL AT- 23.15.
