XAG/USD looks to build on intraday positive move beyond $24.00 mark

• Silver regains positive traction and reverses a part of Friday’s pullback from over a one-week top.
• The technical setup remains tilted in favour of bulls and supports prospects for additional gains.
• A convincing break below a multi-month-old ascending trend-line will negate the positive outlook.

Silver (XAG/USD) attracts some dip-buying near the $23.70 area on the first day of a new week and builds on its steady intraday ascent heading into the European session. The white metal climbs to the $24.00 mark in the last hour and seems poised to build on its recent solid bounce from the mid-$22.00s, or a near one-month low touched last week.

From a technical perspective, the XAG/USD last week showed some resilience below and defended an upward-sloping trend line extending from the October swing low. The subsequent strength and acceptance above the very important 200-day Simple Moving Average (SMA) favours bullish traders. Moreover, oscillators on the daily chart have again started gaining positive traction and support prospects for a further appreciating move.

That said, bulls might wait for some follow-through buying beyond the $24.25-$24.30 area, over a one-week high set on Friday, before placing fresh bets. The XAG/USD might then aim to reclaim the $25.00 psychological mark. The upward trajectory could get extended beyond the $25.25 intermediate hurdle, towards the $25.45-$25.50 region en route to the $26.00 neighbourhood, or the highest level since May 5 touched earlier this month.

On the flip side, any meaningful slide might continue to attract some buyers near the 200-day SMA, currently pegged near the $23.55 region. Some follow-through selling, however, might turn the XAG/USD vulnerable to accelerate the slide back towards the $23.00 mark. The latter nears the aforementioned ascending trend-line support, which if broken decisively will negate the positive outlook and shift the bias in favour of bearish traders.

Silver daily chart

Technical levels to watch