Silver Holds $38.83 Support—Watch These 3 Fibonacci Levels This Week
Silver (XAG/USD) is consolidating after reaching a multi-week high of $39.12, with bulls defending key support zones.
Quick overview
- Silver (XAG/USD) is consolidating at $38.83 after reaching a multi-week high of $39.12, with key support at $38.45.
- The recent rally from $36.27 represents a gain of over 7% in two weeks, with Fibonacci levels indicating potential pullback areas.
- Key resistance levels to watch include $39.12, $39.58, and $40.00, while support is found at $38.45 and $38.03.
- Silver's bullish trend remains intact as long as it stays above $38.45, supported by favorable macroeconomic conditions.
Silver (XAG/USD) is consolidating after reaching a multi-week high of $39.12, with bulls defending key support zones. It’s trading at $38.83, above its ascending trendline and the 50-period simple moving average (SMA) at $38.27, both of which are supporting the overall uptrend.
This latest move comes after a strong rally from $36.27, where silver gained over 7% in two weeks. The Fibonacci retracement levels from the swing low to high are now the key technical framework for traders to watch for pullback areas. So far, price has respected the 23.6% Fib level at $38.45, so buyers are in control – for now.
Silver Key Support and Resistance to Watch
Silver is in a consolidation zone, with RSI coming off overbought but still above 63. So momentum is positive, but a deeper correction can’t be ruled out.
Key resistance zones ahead:
- $39.12 – Recent high and psychological barrier
- $39.58 – Minor horizontal resistance from May
- $40.00 – Round number and multi-month high
Support areas to watch:
- $38.45 – 23.6% Fib
- $38.03 – 38.2% Fib and prior break out zone
- $37.70-$37.36 – 50% and 61.8% Fib confluence
If price breaks the trendline, it could trigger a deeper correction to $37.69-$37.36, which has been a launchpad for previous rallies.
Fundamentals Still Support the Silver Bull Case
Silver’s technicals look good, but it’s the macro that adds more weight to the bull case. Like gold, the precious metals are benefiting from a weaker US dollar, easing inflation expectations and growing confidence the Fed will start cutting rates by late 2025.
Silver often follows gold in times of stress and the overall demand for safe-haven assets is strong. According to Reuters, gold saw some profit taking near five-week highs, but underlying demand is still strong due to geopolitical uncertainties and soft US data.These same forces are working for silver, which is also a precious metal and an industrial commodity. As long as both sides are supporting, dips are seen as buying opportunities not selling.
Conclusion
Silver’s trend is still intact as long as price is above $38.45 and the trendline. A break above $39.12 would likely lead to $39.58 and possibly even $40 in the next few days. Momentum has cooled but the structure is still bullish, supported by both technicals and macro.
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