- Silver is down for the third day in a row and broke a monthly low on Friday.
- Overnight, a break of the $24.50-40 horizontal support favors bearish traders.
- Some subsequent selling below the 38.2% Fibo. will set the stage for deeper losses.
silver it remains under some selling pressure for the third day in a row on Friday, falling to levels below $24.00, or above the monthly low heading into the European session.
Technically, the recent repeated failures near the $26.00 round and the subsequent sharp breakout through the strong horizontal support at $24.50-24.40 favor bearish traders. In addition, the oscillators on the daily chart are holding deep in negative territory and are still not far from the oversold zone. This may have already set the stage for another short-term decline in the value of XAG/USD.
However, the white metal manages to find some support near the 50-day simple moving average (SMA). This is followed by the March-April 38.2% Fibonacci retracement level around the $23.75-$23.70 area which, if breached, will reaffirm the negative bias. XAG/USD could then test the 100-day SMA, currently fixed near the $23.40-$23.45 area, before eventually dropping to the 50% Fibo. level around the $23.00 mark.
On the downside, any meaningful recovery attempt could now face stiff resistance near the $24.40-$24.40 support support point, which coincides with the 23.6% Fibo. level. Lasting power beyond the borders could negate the bear view and lift XAG/USD to the $25.00 psychological level on the way to the $25.55-25.60 resistance. The bulls could then try again to break the $26.00 level and test the YTD high, around the $26.10-$26.15 area.