FX.co ★ Death-X-PK | XAG/USD, SILVER

Silver On Monday, Silver broke down from a modest bear flag but was unable to follow through. Before buyers took back control and pushed the price higher, the slide to a 15-day low of $77.02. Silver is expected to complete a possible bullish hammer candlestick pattern with a high of $81.48 and close the session in the upper part of the day's range. Support emerged soon after the metal finished a 78.6% Fibonacci retracement of the previous internal rally at $77.21, giving the signal greater relevance. Depending on how recent price activity is viewed, the breakdown of the tiny flag may have more bearish importance. On February 20, above $79.50, an upside breakout of an inverse head and shoulders bottom pattern occurred. After regaining the 50-day and 20-day moving averages, the ensuing rally reached a lower swing high at $95.43 before declining. The flag formation reached its lowest point at $77.96 after a first leg down from that peak. It was broken during Monday's first decline, but a daily close below it did not confirm it. The downward continuation failed to confirm given the strong price action that followed the bearish trigger. The second leg down may therefore already have a bottom. This implies that if strength indicators are confirmed, they should be considered carefully. Since unsuccessful patterns can result in abrupt shifts in the other direction, a rally would be the reaction to a failed breakdown. Since this is the first decline since the pattern's breakout, the head and shoulders bottom supports the bullish scenario. A potential upside target around $105.56 is indicated by the pattern's initial measurement aim. But it would be necessary to attempt the 61.8% Fibonacci retracement at $99.67. A different viewpoint is a rising bearish wedge, with a breakdown occurring on Friday following the failure of the lower boundary line and a verified daily and weekly closing below the line. This implies more downward pressure, but only if the support close to Monday's bottom doesn't hold.