Silver Price Analysis: XAG/USD moves further away from multi-month top, downside seems limited

• Silver edges lower for the second straight day and retreats further from a multi-month top.
• The setup still favours bulls and supports prospects for the emergence of some dip-buying.
• A convincing break below the $23.00 confluence is needed to negate the positive outlook.

Silver extends the previous day's retracement slide from an eight-month top and remains under some selling pressure for the second successive day on Thursday. The white metal remains depressed through the first half of the European session and is currently placed around the $23.80-$23.75 region.

From current levels, any subsequent slide is likely to find some support near the $23.55-$23.50 area. Some follow-through selling will expose the $23.00 confluence, comprising the 100-period SMA on the 4-hour chart and an ascending trend-line extending from November low. The said handle should act as a strong base and a key pivotal point to determine the next leg of a directional move for the XAG/USD.

Meanwhile, oscillators on the 4-hour chart - though have been losing traction - are still holding in bullish territory. Furthermore, positive technical indicators on the daily chart support prospects for the emergence of some dip-buying near the aforementioned confluence support. That said, a convincing break below will negate the constructive outlook and shift the bias in favour of bearish traders.

The XAG/USD might then turn vulnerable and accelerate the fall towards testing the $22.00 round-figure mark with some intermediate support near the $22.55-$22.50 horizontal zone. A sustained strength beyond should pave the way for additional near-term gains, lifting the XAG/USD beyond the $24.60-$24.70 zone and allowing bulls to aim towards reclaiming the $25.00 psychological mark.

Silver 4-hour chart

Key levels to watch