Silver Price Analysis: XAG/USD hangs near two-year low, seems vulnerable below $19.00

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Silver Price Analysis: XAG/USD hangs near two-year low, seems vulnerable below $19.00
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Silver Price Analysis: XAG/USD hangs near two-year low, seems vulnerable below $19.00 – by HareshMenghani Silver Commodities Technical Analysis XAGUSD

egion. The intraday slide extended through the first half of the European session and dragged spot prices back below the $19.00 round-figure mark.

Looking at the broader picture, the recent range-bound price action witnessed over the past one-and-a-half week or so constitutes the formation of a rectangle. This points to indecision over the next leg of a directional move for the XAG/USD and warrants caution before placing fresh directional bets.

Given the recent decline from mid-$22.00 or June monthly high, the rectangle could be categorized as a bearish consolidation phase and supports prospects for an extension near-term depreciating move. That said, the oversold RSI on the daily chart could hold back bearish traders on the sidelines.. Some follow-through selling below the $18.75 area, or a two-year low, would make the XAG/USD vulnerable to accelerate the downward trajectory towards the $18.00 en-route the $17.65 support zone.

On the flip side, the top boundary of the aforementioned trading range, around the $19.50-$19.55 area, might continue to act as an immediate strong barrier hurdle. Any subsequent move up is more likely to meet with a fresh supply and run out of steam just ahead of the $20.00 psychological mark. That said, a sustained move beyond the latter might trigger a short-covering move and allow the XAG/USD to surpass an intermediate barrier near the $20.60-$20.65 region, which coincides with the 100-period SMA on the 4-hour chart. The recovery could further get extended towards the $21.00 mark.

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