Will Resistance on the SMA and Fib Level Hold?
Silver price has been consistently closing higher for the past four trading days. However, its technical setup on the daily time frame suggests that its winning streak will soon come to an end. By drawing the Fibonacci retracement tool from the high of February 24 to the low of February 28, we can see that XAGUSD has pared some of its losses back to the 38.2% Fib level. It is also testing resistance at the 100 SMA around 17.40. Reversal candlesticks around this area could mean that silver price may soon fall to its recent lows at 16.37.
Read our Best Trading Ideas for 2020.
Or Will Silver Price Bounce Off Trendline Support?
On the other hand, the hourly chart of XAGUSD suggests that there may still be buyers in the market to push silver price higher. By connecting the lows of February 28, March 3, and March 5, we can see that the previous metal is testing support at the rising trend line. This price also coincides with silver price’s previous highs established on March 3 and March 4. Lastly, by drawing the Fibonacci retracement tool from yesterday’s low to today’s high, we can see that XAGUSD is testing support at the 50% Fib level. A bullish engulfing candle could mean that silver price has some fuel left to trade higher. It could retest today’s Asian session highs at 17.50. If there are enough buyers to push XAGUSD above that level, we could see it rally to its February 27 highs at 18.10.
Don’t miss a beat! Follow us on Telegram and Twitter.
More content
- Follow me on Twitter.
- Download our latest quarterly market outlook for our longer-term trade ideas.
- Do you enjoy reading our updates? Become a member today and access all restricted content. It is free to join.