Silver prices (XAG/USD) are currently hovering around $28.57, facing resistance after recent gains. This analysis combines the information you provided:
Recent Rally and Resistance:
- Silver has seen significant upward movement since May 2nd, climbing from around $26.02 to its current level.
- However, it is now encountering resistance near $28.70, potentially forming a “double top” technical pattern if unable to break through.
Technical Indicators:
- The Relative Strength Index (RSI) remains in bullish territory, suggesting continued upside momentum.
Bullish Scenario:
- A break above the $29.00 psychological level could trigger further gains.
- This would open the door towards the year-to-date high of $29.79 and potentially even $30.00.
Bearish Scenario:
- A decline below $28.00 could signal a potential reversal.
- Initial support could be found at the 38.2% Fibonacci retracement level of $27.70.
- A break below this level could expose the 50% retracement at $27.06.
Key Event: US CPI Data
- The critical factor influencing Silver’s future direction remains the release of US Consumer Price Index (CPI) data on Wednesday.
- A higher-than-expected CPI reading could weaken the Dollar and support Silver prices further.
