Silver is signalling a bearish reversal following the pullback near the 20-day simple moving average (SMA) and more importantly, the close below the ascending trendline that stretches from May 2020.
The 200-day SMA, however, came immediately to the rescue and it could be the last opportunity for a rebound at 24.65 before the door opens for the 22.50 – 21.90 support region. The former resistance area around 20.70 could also adopt a restrictive role if the decline sharpens.
The momentum indicators are currently favoring the bears as the RSI keeps pointing towards its 30 oversold level after failing to jump above 50. The MACD is in line with this narrative too, strengthening its negative momentum below its zero and signal lines.
That said, the above signals could prove false if the white metal manages to bounce on the 200-day SMA and close back above the trendline and the 20- and 50-day SMAs seen at 25.70 and 26.35, respectively. Higher, the bulls may need to climb above the Ichimoku cloud at 27.60 to access the key zone of 28.30 – 29.00.
Briefly, the short-term risk for silver is tilted to the downside, though only a close below the 200-day SMA could execute fresh selling orders.
