- Summary:
- Silver prices (XAG/USD) could be set for a major move south, if the bearish pennant on the daily chart plays out as expected.
Spot silver prices (XAG/USD) were able to inch higher this Friday, retaining the consolidation that has been the lot of the pair all week. From a technical standpoint, silver price continues to trade within the bearish pennant, and this could imply that the XAG/USD could meet with a bearish breakout as the eventual resolution for this pair.
Yields on the 10-year US Treasury asset started the day lower, but picked up momentum in the New York session, allowing silver price to pull back from intraday highs and keep it range-bound. The Fed’s announcement that SLR exemptions for banks would not be extended beyond March 31 did not exert too much downside pressure on silver prices.
This leaves the XAG/USD pair looking towards next week’s manufacturing PMI results from around the world as the immediate fundamental triggers of note.
Technical Levels to Watch
Silver prices continue to trade within the consolidation area formed by the pennant, with 26.325 serving as the immediate resistance level. The expectation is for the pennant to conclude with the XAG/USD breaking to the downside. This move has a projected price objective set at 24.569 initially, with a push towards 24.00 psychological support as a bonus. This move would require the bears to take out 26.034 and 25.386 along the way.
On the other hand, bulls need to push the silver price above the 26.325 resistance to negate the pennant and allow for a push towards 26.868. Above this new resistance, further barriers to the north lie at 27.502 and 28.073.
Silver Price (XAG/USD) Daily Chart
