FX.co ★ HNB | XAG/USD, SILVER

Silver prices are well locked within an impressive bullish run, XAG/USD is close to the 74.10 mark, having continued its upward momentum. Structurally, the market is obviously at a robust trending phase of the market, whereby there are consistent higher highs and higher lows throughout the daily time period. This form of price action indicates a long-term purchasing power and an investment that is yet to make any significant corrective retractions. The momentum still seems to be strongly on the side of buyers as the recent improvement seems to be more of a whim than a correction to the situation. The larger trend formation indicates that silver has clearly crossed above a series of previous resistance levels, and they have now turned into support. The zone near 68.0070.00 that has been the capping of the upside attempts is now the significant structural support zone. Subsequent acceleration of the price following the breakout of this area suggests a successful break out and underlines the presence of significant follow-through. Until silver breaks through this previous band of resistance, the large major trend bias would be solidly to the upside and the pullbacks would be seen as correctional rest pauses and not reversals. In the short run, the silver price is seen to consolidate slightly below the recent highs which is evidence of digestion of gains and not exhaustion. This lateral action on high levels is commonly followed by further extension especially where it takes place in the absence of vicious bearish candles or drastic rejection wicks. Deep pullbacks have been absent hinting the fact that sellers are finding it tough to sustain themselves further supporting the strength of the current uptrend. The support is now found at and around 72.00-72.50. This space is in line with minor swing lows that have occurred recently and the first area at which there is likelihood of buyer defense of the trend at shallow retracements. The market standing above this zone would mean that the bullish control is still in place and any weakness in the market is remedial. Any daily close lower than this would be an indication of a temporary lack of momentum and encourage a more severe retracement. There is a more serious support zone below that between 68.00 and 70.00. This area is one of the significant structural floors of the existing trend, as well as the position of the bottom of the last impulsional leg higher. A retraction to this area would remain technically sound and in line with trend continuation, as long as the price levels off and does not result in any lasting bearish follow-through. A resolute downward fluctuation below this area would only significantly harm the bullish formation and point to a shift of consolidation or remedial period. On the positive side, silver is not very resistant to historical factors owing to the power and pace of the development. The level of 75.00 is one of the most important psychological resisting levels where profit-taking might occur. An end of the day close of above this will affirm the new bullishness and most probably cause another surge of higher projections in the 78.00-80.00 area. These levels would reflect extension areas and not conventional resistance, i.e. the volatility may go up as the price enters unknown territory. Analysis of trend structure emphasize that momentum in the market is well upheld with price. Its steep purchase interest, as indicated by the steep angle of ascent, but this raises the likelihood of sharper corrective action in the event of a start in the loss of momentum. There are, however, no technical indications of the exhaustion of the trend until lower highs or lower lows establish themselves. Powerful trends tend to be overstated even more than usual, particularly where the trends are backed by steady demand and minor pullbacks. The volatility is still high and has not led to destabilizing price movements. Rather, upside expansion has been accompanied by volatility as is a characteristic of trending markets. The swings of short consolidation and further breakouts indicate that the buyers are utilizing the consolidation phases to accumulate positions and not to exit them. Such conduct also contributes to the bullish bias. All in all, the silver is in a highly specified and robust uptrend, and the price is near recent highs of 74.10. The most important levels of support include 72.00-72.50 and 68.00-70.00, which are downside levels, and resistance areas at 75.00 and above projection areas, which are the possible upside levels. Until price falls below its significant support levels and the series of highs and highs are broken, the technical picture will highly be optimistic and pullbacks will be viewed as correctional to the overall upward trend.