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• Silver attracts some dip-buying following the overnight pullback from a one-month peak.
• The technical setup seems tilted in favor of bulls and supports prospects for further gains.
• Dips towards the $29.20 confluence hurdle breakpoint could be seen as a buying opportunity.

Silver (XAG/USD) regains positive traction during the Asian session on Wednesday and stalls the overnight modest pullback from the vicinity of the $30.00 psychological mark or over a one-month high. The white metal currently trades around mid-$29.00s and seems poised to prolong its recent goodish recovery from the lowest level since May touched earlier this month. 

From a technical perspective, the emergence of dip-buying near the $29.20 confluence hurdle breakpoint– comprising the 50-day Simple Moving Average (SMA) and the 50% Fibonacci retracement level of the July-August slide – validates the positive outlook. Moreover, oscillators on the daily chart have been gaining positive traction and are far from being in the overbought zone. This, in turn, suggests that the path of least resistance for the XAG/USD is to the upside. 

That said, the overnight failure near the $30.00 round figure makes it prudent to wait for some follow-through buying before positioning for a further near-term appreciating move. The XAG/USD might then climb to the $30.55-$30.60 area, or the 78.6% Fibo. level. The momentum could extend beyond the $31.00 mark, towards the $31.30-$31.40 supply zone en route to the July swing high, around the $31.75 region, the $32.00 level and the $32.50 area, or the YTD peak.

On the flip side, the $29.20 area might continue to act as an immediate strong support ahead of the $29.00 round-figure mark. A convincing break below the latter could make the XAG/USD vulnerable to accelerate the slide towards the $28.55 region, or the 38.2% Fibo. level, before eventually dropping to the $28.00 round figure. Failure to defend the said support levels might expose the $27.25 support and the next relevant support near the $27.00 mark.

Silver daily chart
 

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