Silver Price Forecast: XAG/USD Holds Firm, Negative Divergence Looms
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- Silver trades at $32.35 after briefly touching a three-month high of $33.39.
- RSI remains bullish, but failure to confirm higher highs raises caution.
- Key support at $31.92; upside targets $32.50 and $33.00 psychological level.
Silver price edges higher and registered gains of over 0.70% on Monday as US financial markets remained closed in observance of Presidents’ Day. At the time of writing, XAG/USD trades at $32.35 as Tuesday’s Asian session begins, virtually unchanged.
XAG/USD Price Forecast: Technical outlook
The grey metal shifted from neutral to upward biased, though a quick rejection candle printed on February 14 after hitting a three-month high of $33.39 could pave the way for further downside.
The Relative Strength Index (RSI) remains bullish, but it is worth noting that as XAG/USD spiked past $33.00, the RSI failed to record a higher high, indicating that a ‘negative divergence’ looms.
If Silver drops below the February 17 swing low of $31.92, the grey metal would be poised to test the 100-day Simple Moving Average (SMA) at $31.15. A breach of the latter will expose the 50 and 200-day SMAs, each at $30.60 and $30.42.
On the other hand, if XAG/USD rallies past $32.50, the psychological $33.00 mark would be the key resistance. Once surpassed, the year-to-date (YTD) high would be up next at $33.39.
XAG/USD Price Chart – Daily
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