Silver is edging higher as the market is digesting today’s data releases and the bulls are trying to make a stand, following the aggressive sell-off from the July 20 high of 25.25. With the 200-day simple moving average (SMA) broken, the bulls have pinned their hopes in defending the busy 22.24-22.50 area and preventing the formation of a lower low.
In the meantime, the momentum indicators are tentatively on the bears’ side. The Average Directional Movement Index (ADX) is pointing to a muted bearish trend in the market. Similarly, the RSI is trading well below its midpoint but is failing to make a lower low. More importantly, the stochastic oscillator has dived into its oversold area, building a significant gap from its moving average. It can stay there for a while before signaling that a price reversal is imminent.
Should the bears ignore the muted signals, they could try to break below the busy 22.24-22.50 area populated by the June 6, 2022 high and the 50% Fibonacci retracement of the March 8, 2022 – September 1, 2022 downtrend respectively. Even lower, the September 1, 2022 upward sloping trendline could prove tougher to crack than currently foreseen.
On the other hand, the bulls are keen on staging a move above the 23.18-23.35 range, defined by the 61.8% Fibonacci retracement and the 200-day SMA. If successful, they could then have a go at pushing silver towards the midpoint of the rectangle, which has been in place since November 2022, by overcoming the resistance set by the busy 23.55-24.04 area.
To conclude, silver bulls are on the back foot, and they are anxiously trying to limit the bearish momentum fueling the current downleg.
Silver is edging higher as the market is digesting today’s data releases and the bulls are trying to make a stand, following the aggressive sell-off from the July 20 high of 25.25. With the 200-day simple moving average (SMA) broken, the bulls have pinned their hopes in defending the busy 22.24-22.50 area and preventing the formation of a lower low.
In the meantime, the momentum indicators are tentatively on the bears’ side. The Average Directional Movement Index (ADX) is pointing to a muted bearish trend in the market. Similarly, the RSI is trading well below its midpoint but is failing to make a lower low. More importantly, the stochastic oscillator has dived into its oversold area, building a significant gap from its moving average. It can stay there for a while before signaling that a price reversal is imminent.
Should the bears ignore the muted signals, they could try to break below the busy 22.24-22.50 area populated by the June 6, 2022 high and the 50% Fibonacci retracement of the March 8, 2022 – September 1, 2022 downtrend respectively. Even lower, the September 1, 2022 upward sloping trendline could prove tougher to crack than currently foreseen.
On the other hand, the bulls are keen on staging a move above the 23.18-23.35 range, defined by the 61.8% Fibonacci retracement and the 200-day SMA. If successful, they could then have a go at pushing silver towards the midpoint of the rectangle, which has been in place since November 2022, by overcoming the resistance set by the busy 23.55-24.04 area.
To conclude, silver bulls are on the back foot, and they are anxiously trying to limit the bearish momentum fueling the current downleg.
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