Key Takeaways:
- Silver continues to decline, posting another lower low at $28.85.
- The 50-day SMA may act as a barrier to further downside movement.
- The RSI is showing bullish convergence with the price, indicating a potential for a pullback or recovery.
Silver Price Analysis
Silver (XAG/USD) experienced a nearly 2.0% drop after the release of US factory-gate inflation data, breaking below the June 11 low of $29.04. The current downtrend, marked by lower lows and lower highs since May, is likely to continue.
Silver 4-hour Chart
If Silver drops below $28.85 (June 13 low), it will confirm another lower low and extend the bearish trend. A potential target lies at $28.21, the 0.618 Fibonacci ratio, while the 50-day SMA at $28.93 could provide support against further declines.
While there is a possibility of Silver reaching $27.19 as a second target, the RSI is indicating a lack of strong bearish momentum, raising the chances of a pullback or recovery. Only a close above $31.00 would cast doubt on the current downtrend.
FAQs
1. What is the significance of the 50-day SMA for Silver’s price?
The 50-day Simple Moving Average (SMA) at $28.93 could act as a barrier to further downside movement in Silver’s price, providing potential support against continued declines.
2. How does the RSI indicator impact Silver’s price movement?
The Relative Strength Index (RSI) showing bullish convergence with price indicates a potential for a pullback or recovery in Silver’s price, suggesting a lack of strong bearish momentum.
3. What price levels could Silver reach in the short term?
If Silver continues its downtrend, potential target levels include $28.21 based on Fibonacci ratios and $27.19 as a second target. However, a close above $31.00 could signal a possible reversal of the trend.
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