Silver (XAG/USD) continues to extend its gains, marking its third consecutive session of upward movement, trading near $30.80 per troy ounce during the Asian hours on Wednesday. The precious metal is experiencing a bullish trend, supported by both technical indicators and favorable short-term market sentiment.
Bullish Technical Setup
A closer look at the daily chart for XAG/USD reveals an ascending channel pattern, reinforcing the ongoing bullish bias. The pair is currently positioned above both the nine-day and 14-day Exponential Moving Averages (EMAs), signaling short-term positive momentum. Additionally, the 14-day Relative Strength Index (RSI) remains above the 50 level, further supporting the notion of active bullish sentiment in the market.
Key Resistance and Upside Potential
On the upside, the initial resistance is seen around the upper boundary of the ascending channel at $31.80. If Silver breaks above this level, it could trigger increased buying interest, potentially propelling the price toward its two-month high of $32.28, last achieved on December 9. This breakout would provide the next target for bullish traders and could signal a sustained upward trend.
Immediate Support Levels
In terms of support, XAG/USD has immediate backing at the nine-day EMA near $30.47, followed closely by the 14-day EMA around $30.32. If the price pulls back, further support is seen at the lower boundary of the ascending channel near the $30.00 mark. A break below this key level would shift sentiment towards a bearish outlook, with downside risks targeting the four-month low at $28.74, last recorded on December 19.
Summary
The silver market remains bullish in the near term, with momentum intact as the price stays above key moving averages and the RSI remains in positive territory. Traders should watch the resistance around $31.80 and the support levels near $30.47 and $30.00 for potential breakouts or pullbacks. A breakout above $31.80 could pave the way for further gains, while a drop below $30.00 would signal a shift toward a bearish trend.
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