Title: Silver Price Analysis: XAG/USD bulls look to seize back control, move beyond $25.00 awaited
Nov 22, 2021 10:18AM ET
Silver attracted fresh buying near $24.00 on the first day of the new week and climbed back closer to the key psychological level of $25.00 at the start of European trading.
From a technical perspective, the recent downward movement from a three-month high was along a downward channel. Against the backdrop of a strong recovery from a 14-month low reached in September, the aforementioned trading range on the short-term charts represents the formation of a bullish flag pattern.
The positive outlook is underpinned by the fact that the technical indicators on the daily chart have lost momentum but are still comfortably in bullish territory. In addition, the emergence of dip-buying near a strong horizontal resistance point favours bullish traders.
This, coupled with the formation of an ascending trading range on the daily chart, supports the prospects of a resumption of the previous and well-established uptrend seen over the past two months. Some follow-through buying will confirm the constructive setup and pave the way for further gains.
The XAG/USD price could then resume an accelerated move towards the $25.35-40 region, the highest level since August 5, reached earlier this month. Momentum could drive the white metal above the intermediate resistance of $25.60 and allow the bulls to recapture the round $26.00 level.
On the other hand, the resistance area around $24.50, which has now turned into support, should continue to protect the immediate downtrend. This is followed by the meeting of the 100-day SMA and the lower end of the ascending channel at $24.10-$24.00, the breach of which would destroy the positive trend.