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  • Silver registers a modest recovery from a nearly one-month low and snaps a two-day losing streak.
  • Oversold RSI (14) on hourly charts helps the XAG/USD to find support near the 23.6% Fibo. level.
  • The technical setup, however, favours bearish traders and supports prospects for additional losses.

Silver stages a modest intraday recovery from a nearly one-month low, around the $22.20-$22.15 region touched earlier this Monday and reverses a part of Friday’s heavy losses. The white metal, for now, seems to have snapped a two-day losing streak, though the near-term technical setup seems tilted firmly in favour of bearish traders.

The steep decline witnessed over the past two trading sessions confirmed a near-term breakdown through the $23.00-$22.90 strong horizontal support. The said area marked the lower end of a nearly two-month-old trading range and coincided with the 23.6% Fibonacci retracement level of the recent rally from October 2022. Furthermore, acceptance below the 50-day SMA adds credence to the negative outlook for the XAG/USD.

That said, the oversold RSI (14) on hourly charts assists the XAG/USD to find support near the 38.2% Fibo. level and stall its sharp pullback from the highest level since April 2022 touched last week. Hence, it will be prudent to wait for some follow-through selling below the $22.20-$22.15 area before positioning for a fall below the $22.00 mark, towards the next relevant support near the 100-day SMA, around the $21.60-$21.55 zone.

On the flip side, the aforementioned confluence support breakpoint near the $23.00-$22.90 region now seems to act as an immediate strong barrier. Any subsequent move up might now be seen as a selling opportunity and runs the risk of fizzling out near the 50-day SMA, currently around the $23.30-$23.35 region. That said, a sustained strength beyond will negate the bearish bias and prompt some short-covering around the XAG/USD.

Silver daily chart

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Key levels to watch

Source: https://www.fxstreet.com/news/silver-price-analysis-xag-usd-seems-vulnerable-short-term-trading-range-breakdown-in-play-202302061313