XAG/USD holds bullish below $70.00/two-month high set on Friday

• Silver kicks off the new week on a subdued note and oscillates in a range below a two-month high.
• Last week’s breakout through key technical barriers favors bulls and backs the case for further gains.
• A move beyond the 50% Fibo. near the $72.00 mark is needed to reaffirm the constructive outlook.

Silver (XAG/USD) seesaws between tepid gains and minor losses around the $69.00 mark through the Asian session on Monday. The white metal, however, remains within striking distance of a two-month high, around the $70.00 psychological mark touched on Friday, and seems poised to appreciate further.

The XAG/USD holds a near-term bullish bias following last week’s breakout above the $66.65-$66.70 horizontal resistance and the 38.2% Fibonacci retracement of the May-July decline. Moreover, the white metal holds above the 200-period Simple Moving Average (SMA) on the 4-hour chart, which, along with positive oscillators, underpins the advance.

The Moving Average Convergence Divergence (MACD) stays marginally positive, hinting that the upward trajectory is still in place but moderating. Furthermore, the Relative Strength Index (RSI) near 66 suggests strong buying pressure, though the approach toward overbought territory could slow the pace of gains.

Hence, a subsequent move up might confront initial resistance at the 50.0% retracement at $71.95, ahead of the 61.8% level at $76.08, with further barriers at the 78.6% retracement at $81.97 and the cycle high at $89.47. On the downside, immediate support is seen at the reclaimed 38.2% Fibo. retracement at $67.81, followed by the 23.6% level at $62.70 and the 200-period SMA at $60.93, while a deeper setback would expose the structural floor anchored around $54.43.

XAG/USD 4-hour chart

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