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Silver Price Analysis: XAG/USD climbs closer to mid-$28.00s, remains below YTD top set on Friday

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  • Silver regains positive traction and reverses a part of Friday’s retracement slide from the YTD peak.
  • The RSI on the daily chart is flashing overbought conditions and warrants caution for bullish traders.
  • Any meaningful slide might continue to attract fresh buyers and is more likely to remain cushioned.

Silver (XAG/USD) catches fresh bids on the first day of a new week and stalls its retracement slide from the vicinity of the $29.80 region, or the highest level since February 2021 touched on Friday. The white metal sticks to intraday gains through the early part of the European session and is currently placed just below mid-$28.00s.

From a technical perspective, the recent breakout through the $25.60-$25.70 horizontal resistance and the subsequent move up was seen as a fresh trigger for bullish traders. That said, the Relative Strength Index (RSI) is flashing overbought conditions on the daily chart and makes it prudent to wait for some near-term consolidation or a modest pullback before positioning for any further appreciating move.

Meanwhile, any corrective decline below the $28.00 round figure is likely to find decent support near the $27.80-$27.75 region, below which the XAG/USD could accelerate the fall towards the $27.25 area en route to the $27.00 mark. Some follow-through selling might expose the next relevant support near the $26.35-$26.30 region before the white metal drops to the $26.00 mark and the $25.70-$25.60 resistance breakpoint.

On the flip side, sustained strength back above the $28.50 level should allow the XAG/USD to reclaim the $29.00 mark. The momentum could extend further towards the $29.80 zone, or the YTD peak, above which bulls are likely to aim back towards conquering the $30.00 psychological mark.

Silver daily chart

fxsoriginal

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