Silver Price Analysis: XAG/USD corrects from multi-week high, slides to $23.75-70 area

• Silver witnessed an intraday turnaround from the four-week high touched last week on Friday.
• The setup favours bullish traders and supports prospects for the emergence of some dip-buying.
• Sustained strength beyond the $24.00 mark is needed to confirm the near-term positive outlook.

Silver continued with its struggle to find acceptance above the $24.00 mark and witnessed an intraday turnaround from the four-week high touched last week on Friday. The white metal, for now, seems to have snapped three days of the winning streak and was last seen trading near the daily low, around the $23.75-$23.70 region heading into the North American session.

From a technical perspective, the recent strong rebound from the monthly low, around the $22.00 mark has been along an upward sloping channel and points to a short-term uptrend. The constructive set-up is reinforced by the fact that technical indicators on the daily chart are holding comfortably in the positive territory and are still far from being in the overbought zone.

That said, repeated failures near the aforementioned handle warrant some caution for aggressive bullish traders. This makes it prudent to wait for sustained strength beyond the $24.00 mark before positioning for a move towards the $24.25 confluence hurdle. The latter comprises the very important 200-day SMA and a descending trend-line extending from July 2021 swing high.

A convincing breakthrough will be seen as a fresh trigger for bullish traders and lift the XAG/USD back towards the YTD high, around the $24.70 region. The momentum could further get extended towards reclaiming the key $25.00 psychological mark en-route November 2021 high, around the $25.35-$24.40 region.

On the flip side, any further decline pullback is likely to find decent support near the $23.30 region ahead of the $23.round-figure mark. Failure to defend the said support levels will shift the bias in favour of bearish traders and make the XAG/USD vulnerable. The next relevant support is pegged near the $22.75 region, below which the metal could slide to the mid-$22.00 mark.

Silver daily chart

Technical levels to watch