XAG/USD: Bears Keep Silver Near 50-Day SMA
Silver continues correction after recent high
Following last Friday’s price decline, on Monday, November 11, silver is attempting to rise, trading at $31.45, which is near its 50-day SMA.
Thus, the white metal remains close to the three-week low reached last Wednesday, and, with the bearish trend continuing, it may extend its correction from the recently reached 12-year high.
The strong psychological level at $30.00, with support around $29.50-$29.45 and the 200-day SMA in the $28.70-$28.65 range, helps limit further decline in silver.
On the other hand, the $32.00 level has become a strong barrier for the XAG/USD pair, above which silver could rise to the supply zone of $32.35-$32.40. If positive momentum continues, the next significant barrier for the white metal would be $33.00.
A lot depends on geopolitics
The further movement in silver prices will depend on whether tensions in the Middle East escalate further, the outlook for an economic recession in China, and the implementation of Donald Trump’s plans after he takes office.
As previously mentioned, the positive trend looks more favorable, driven by sustained demand for safe-haven assets. Notably, on October 23, gold reached a new high, climbing to $2,755 per ounce.
Many consider silver undervalued, increasing the likelihood of a bullish scenario. However, traders should also consider the impact of speculative capital on silver price formation, which explains the metal’s high volatility over longer periods.
