Experiences in forex trading, by a special way.

November 17, 2022

XAGUSD pares losses to one-week low

- Silver drops to a one-week low on Thursday, though finds support ahead of the $21.00 mark.

- The mixed technical setup warrants some caution before placing aggressive directional bets.

- A convincing break below the $21.00 mark is needed to support prospects for further losses.

Silver extends this week's retracement slide from over a five-month high and remains under some selling pressure for the third successive day on Thursday. The white metal, however, finds some support ahead of the $21.00 mark and recovers a part of its intraday losses to a one-week low. The XAGUSD steadily bounces to the $21.35-$21.40 region during the early European session, though lacks follow-through and still seems vulnerable.

Repeated failures to find acceptance above the $22.00 round figure and a subsequent slide back below the 200-hour SMA suggest that the recent rally might have run out of steam. A sustained break below the $21.00 mark will reaffirm the negative bias and pave the way for a slide towards the next relevant support near the $20.40-$20.35 region. The corrective decline could get extended and drag spot prices to the $20.00 psychological mark.

That said, oscillators on the daily chart - though have been retreating - are still holding comfortably in bullish territory. This might hold back traders from placing aggressive bearish bets around the XAGUSD and help limit deeper losses, at least for the time being.

Meanwhile, on the upside strength beyond the $21.40-$21.50 immediate hurdle might attract some sellers near the $21.70 horizontal barrier and remain capped around the $22.00 round-figure mark. This is closely followed by the multi-month peak, around the $22.25 region, which if cleared will set the stage for additional gains. The XAGUSD might then accelerate the momentum to the $22.50-$22.60 supply zone and eventually reclaim the $23.00 mark.

Silver 1-hour chart

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