Silver (XAG/USD) faces selling pressure at the start of the week, dropping below the key $32.00 mark during the Asian session on Monday. The white metal has reversed a three-day winning streak, which culminated in a one-week high on Friday. However, the technical outlook suggests that there could be opportunities for dip-buying at lower levels.
Last week’s breakout above the 50% Fibonacci retracement level of the recent decline from the March swing high to the fresh year-to-date low was seen as a significant bullish signal. Despite this, silver has struggled to gain traction above the 61.8% Fibonacci level. Oscillators on the daily chart have yet to confirm a sustained upward momentum, prompting caution for traders before betting on a major price increase.
Key Technical Levels and Market Outlook
It may be wise for traders to wait for additional buying momentum beyond the 200-period Simple Moving Average (SMA) on the 4-hour chart, currently located around the $32.55-$32.60 range, before entering new bullish positions. If silver breaks through this level, it could target a recovery toward the $33.00 mark, with further upside potential toward the 78.6% Fibonacci level around $33.20. Beyond this, the next resistance levels are seen near the $33.50-$33.55 region, followed by the $34.00 area, which coincides with the March swing high.
On the downside, silver is likely to find support near the $31.35-$31.30 region, or the 50% Fibonacci level. A decisive break below this level could trigger technical selling, pushing the price further down to the $31.00 mark and possibly toward the $30.55 area, or the 38.2% Fibonacci level. If downward momentum persists, silver could test the psychological $30.00 level, with further support at $29.55, the 23.6% Fibonacci retracement level.
