Silver prices have been on a volatile ride over the past few weeks, with the price of the precious metal hitting a low of $21.44 and a high of $22.00. After a prolonged period of losses, silver prices have managed to stabilize and are currently trading at $21.71.
Despite the recent stabilization, silver prices remain shy of reclaiming the 200-day Exponential Moving Average (EMA) of $21.94. This is an important level for silver prices, as a break above it would underpin the XAG/USD towards the psychological $22.00 mark.
The Relative Strength Index (RSI) is currently in bearish territory, indicating that bears are still in control of the market. However, the RSI has turned flat, suggesting that the bears are taking a breather before re-attempting to drive prices lower.
On the 1-hour chart, silver prices have been trading in a sideways range between the daily pivot at $21.64 and the R1 daily pivot at $21.84. Should the XAG/USD fail to break above the R1 daily pivot, the daily chart bias will remain intact.
In this case, the first support level for silver prices would be the daily pivot at $21.64, followed by the S1 pivot point at 21.40. A breach of the latter and the following line of defense for Silver bulls would be the S2 daily pivot at $21.19, followed by the S2 area at $20.96.
A break below the $21.40 level would be a bearish sign, indicating that the bears are regaining control of the market and exposing the $21.00 mark. On the other hand, a third daily close below the 200-day EMA would cement Silver’s price downward bias.
Overall, silver prices have managed to stop their fall and are attempting to recover the 200-day EMA. However, the XAG/USD remains shy of reclaiming the $21.94 price level, and a break below the $21.40 mark would expose the $21.00 mark.
In the short term, traders will be watching the price action around the $21.40 and $21.84 levels. A break above the R1 daily pivot would indicate that the bulls are regaining control of the market, while a break below the $21.40 level would indicate that the bears are back in control.
In either case, traders should keep an eye on the 200-day EMA and the $21.00 mark, as these levels will provide key insights into the near-term direction of silver prices.
