The price of silver (XAG/USD) begins the new trading week on a firm footing, climbing back above the critical $33.00 psychological mark during the Asian session. This modest rebound follows a partial retracement of Friday’s pullback and has attracted attention from dip-buyers, signaling sustained interest in the precious metal.
However, the upside move so far appears to lack strong bullish conviction, with market participants remaining cautious amid mixed signals from broader financial and technical backdrops. The article from TelaraX features a detailed analysis by its experienced brokers.
Technical Landscape: Bullish Setup Still Intact
From a technical analysis perspective, silver’s recent price behavior suggests a bullish consolidation phase. For the past two weeks, XAG/USD has been oscillating in a tight range, forming a rectangle pattern on short-term charts.
This consolidation follows a breakout from a descending channel, a development that typically favors further upside if confirmed by momentum.
The daily chart shows that while the Relative Strength Index (RSI) and Moving Average Convergence Divergence (MACD) remain in positive territory, they have yet to show strong upside momentum, hinting at market hesitation. Nonetheless, the broader technical setup still favors buyers, especially given the metal’s ability to hold above key support levels.
Key Support Levels: Dips Remain Cushioned
Market dynamics suggest that dips below the $33.00 threshold are likely to be treated as buying opportunities. The $32.75–$32.70 region forms the lower boundary of the current consolidation zone and is expected to act as initial support.
A decisive breakdown below this range could test the 100-day Simple Moving Average (SMA), currently located just above the $32.00 mark.
Should this level fail to hold, the next technical support lies near $31.40, an important inflection point. A sustained breach of this level would alter the short-term bias, potentially shifting control to bearish traders and triggering a deeper correction in silver prices.
Resistance Zones: Bulls Eye Fresh Highs
On the upside, XAG/USD faces immediate resistance near the $33.50 supply zone. This level has acted as a price ceiling in recent sessions and is crucial for determining the next leg of movement.
A decisive break and sustained strength above this area would reinforce the constructive outlook and set the stage for an advance toward $33.65–$33.70, a resistance band representing the highest price reached since early April.
If bulls manage to maintain momentum past that level, attention will shift toward the $34.00 round figure, a historically significant psychological barrier. Continued bullish pressure could ultimately drive XAG/USD toward a retest of the 2024 year-to-date high at $34.55–$34.60, established back in March.
Broader Market Drivers: What’s Supporting Silver?
Silver‘s price movement is also being shaped by a mix of fundamental and macroeconomic factors. A supportive backdrop includes continued concerns about global inflation, geopolitical instability, and central bank policy shifts, particularly from the Federal Reserve.
Investors are closely watching incoming data for signs that the Fed may pause or reverse rate hikes, a scenario that typically weakens the U.S. dollar and strengthens precious metals such as silver and gold.
Moreover, silver is not only a monetary metal but also an industrial commodity, with widespread use in renewable energy, electronics, and automotive sectors. Rising demand forecasts, particularly amid the ongoing green energy transition, have contributed to a more bullish long-term outlook for the metal.
Investor Sentiment: Tactical Buying Prevails
Despite the lack of momentum-driven rallies, sentiment among retail traders and institutional participants remains moderately optimistic. This is reflected in options positioning, futures open interest, and ETF inflows, all of which show a preference for accumulating on dips rather than initiating aggressive selling.
The prevailing narrative suggests that while traders may be hesitant to chase prices higher without confirmation, the broader market still expects XAG/USD to break out of its current consolidation range in an upward direction. Therefore, any pullbacks are likely to be limited and well-supported in the near term.
Conclusion: Silver Holding Ground, Breakout Likely
To summarize, silver prices remain firmly supported above the $33.00 mark, with the technical setup continuing to favor bullish traders. Although upside momentum is lacking in the very short term, the potential for an eventual breakout remains intact as long as support levels hold and the macro backdrop stays favorable.
The near-term bias for XAG/USD hinges on whether the metal can decisively clear the $33.50 resistance zone. A successful breach could open the door for a climb toward $34.00 and beyond. Conversely, a breakdown below $32.70 may invite deeper corrections, though such moves are likely to be viewed as opportunities rather than trend reversals.
