Silver price rallies sharply and is testing the 200-day Exponential Moving Average (EMA) as US Treasury bond yields drop, undermining the American Dollar, on Tuesday amidst a light economic calendar, as US midterm elections get the center spotlight. At the time of typing, the XAGUSD is trading at $21.47 after hitting a fresh 5-month high at $21.62.

Silver price is advancing sharply and pierced the 200-day EMA toward hitting the 5-month high at $21.62. Nevertheless, it trimmed some gains, hoovering around the 200-day EMA at $21.48. if XAGUSD buyers achieve a daily close above the latter, the white metal bias will shift upwards, opening the door for further gains. Hence, the XAGUSD’s first resistance would be $22.00, followed b the June 6 swing high at $22.51, followed by the psychological $23.00.

Also supporting the short-term bearish bias is the RSI (14) which is near the overbought conditions.

It should be noted that the previous weekly top near $20.10 and the $20.00 could test the XAGUSD bears before directing them to the $19.45 support confluence including the 100-DMA and an upward-sloping trend line from October 14.

In a case where silver price remains bearish past $19.45, a gradual downturn towards the previous monthly low near $18.10 can’t be ruled out. During the fall, the $19.00 threshold may act as an intermediate halt.

On the flip side, a daily closing beyond October’s peak of $21.24 defies the bearish “hanging man,” candlestick.

Even so, a convergence of the 200-DMA and an ascending trend line from August, close to $21.50, will be a strong resistance for the XAGUSD bulls to cross.

Should the metal buyers manage to conquer the $21.50 hurdle, the odds of witnessing a run-up toward the mid-2022 peak surrounding $22.50 can’t be ruled out.

Silver to drop below EMA-200 before further upside

Nov 08 2022

Stop Loss -2.61%

Holding time 2d4hr

21.44

Entry price

22.00

Stop loss price