Silver chart (XAG/USD) is showing a lot of potential for the bulls. The strong surge from $12 to almost $30 during March and July 2020 was an extremely impulsive price swing.
The XAG/USD needs to break above the resistance trend line (orange) and fractal to confirm the uptrend continuation.
Is a breakout nearby? And what kind of bullish targets are possible? Let’s review the key chart and wave patterns.
Price Charts and Technical Analysis
This break would confirm the currently expected wave pattern. Which is a wave 12345 (pink). The most recent top is probably a wave 3 and the current pullback a wave 4.
This wave outlook remains valid as long as price stays above the 50% Fib. A break below the support places it on hold (yellow) and a deeper break indicates an invalidation (red).
The main targets are located at the Fibonacci levels, such as:
- -27.2% Fibonacci target at $34.78.
- -61.8% Fibonacci target at $41.07.
- -100% Fibonacci target at $48 and previous top.
- A break of the top.
On the 4 hour chart, price action could have completed a 5 wave (grey) pattern within the wave C (purple) at the lowest low.
The current bullish momentum is probably a wave 1 (grey) pattern. And the pullback might have completed a wave 2 (grey).
But price action needs to break above the top. A failure to break could indicate a deeper pullback (dotted orange arrows).
The Silver chart looks bullish either after a breakout or after a pullback.
