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XAG/USD drops to multi-week low, bears have the upper hand near $32.00
- Silver remains under heavy selling pressure for the third straight day on Thursday.
- A breakdown below the 100-hour SMA could be seen as a fresh trigger for bears.
- Traders now await acceptance below $32.00 before positioning for further losses.
Silver (XAG/USD) drifts lower for the third straight day – also marking the fourth day of a negative move in the previous five – and drops to over a two-week low during the Asian session on Thursday. The white metal, however, shows some resilience below the $32.00 mark, though the technical setup supports prospects for an extension of a one-week-old downtrend.
An intraday breakdown below the 100-hour Simple Moving Average (SMA) could be seen as a key trigger for bears. Moreover, oscillators on daily/4-hour charts have been gaining negative traction and validate the near-term bearish outlook, suggesting that the path of least resistance for the XAG/USD is to the downside. That said, it will still be prudent to wait for acceptance below the $32.00 mark before positioning for deeper losses.
The subsequent downfall has the potential to drag the XAG/USD to the $31.70 support en route to the $31.55-$31.50 region and eventually to sub-$31.00 levels, or the 200-day SMA. The latter should act as a strong near-term base, which if broken decisively should pave the way for a slide towards the $30.00 psychological mark, with some intermediate support near the $30.55-$30.50 region.
On the flip side, the 100-hour SMA support breakpoint, currently pegged near the $32.35 area, now seems to act as an immediate hurdle ahead of the $32.55 region, the $32.75-$32.80 supply zone. This is closely followed by the $33.00 mark, above which a bout of a short-covering move could lift the XAG/USD to the $33.70 strong barrier. A sustained strength beyond the latter could negate the negative outlook and shift the bias in favor of bulls.
