Under $22 threshold, XAG/USD in Silver Price Analysis slips after reaching one-week high, indicating vulnerability
Silver Prices Drop, Bearish Trend Continues
Silver prices faced selling pressure on Tuesday, breaking a two-day winning streak and dropping to a one-week low of around $22.00. The metal continued to decline during the European session, trading near the daily low of $21.70, down over 0.75% for the day.
From a technical perspective, the recent failure near the 200-day Simple Moving Average (SMA) and a breakdown through the $22.30-$22.20 support level suggests a bearish trend. Oscillators on the daily chart also indicate that the XAG/USD is likely to continue moving downwards.
Support and Resistance Levels
If the silver price drops below the overnight swing low of $21.55, it will confirm the negative bias and push the metal towards the trading range resistance at $21.3-$21.30. The next support level is around $21.00, and if that is broken, the XAG/USD could slide to $20.70-$20.65, which is a nearly seven-month low reached last week. Breaking this level could lead to a continuation of the downward trend, potentially challenging the year-to-date low just below $20.00.
Possible Upside Momentum
On the other hand, if silver prices surpass the $22.00 mark, they are likely to face resistance near the previous support level of $22.20-$22.30. However, if the momentum continues, it could trigger a short-covering rally and push the XAG/USD to reclaim the $23.00 mark. Further upward momentum could even take the price towards the 200-day SMA at around $23.35.