Key Points:
- Silver consolidates above $38.00 after a breakout, with a bullish trend intact.
- Resistance at $39.53 remains in focus, but near-term gains may be capped by channel resistance.
- The 50-Day moving average continues to provide strong support for silver.
Silver Price Shows Strong Momentum, Remains Bullish
Silver closed at an all-time high of $38.87 last week, showing significant strength and maintaining its upward trajectory. The precious metal hit a four-week high of $39.06 before seeing a slight pullback to $38.87. Despite this minor correction, silver continues to hold above key support levels, indicating that buyers remain in control. This bullish sentiment is further reinforced by a successful retest of the rising 20-Day moving average at $37.89, which acted as dynamic support before silver surged higher.
Trend Structure Remains Bullish Above Key Support
Silver’s rally has pushed the metal above the previous swing high of $38.74, keeping it within the rising trend channel that has been in place since late July. The recent pullback to $36.96 tested the lower line of this channel as well as the 50-Day moving average, both of which have held firm. The 50-Day moving average has now supported two significant swing lows: one in early August and another at the latest trough, solidifying its role as a key support level in the medium-term trend. As long as silver stays above the 50-Day moving average (currently near $37.10), the overall bullish trend remains intact.
Near-Term Resistance and Targets
With silver consolidating within the upper third of last Friday’s wide-range day, attention now turns to the next key resistance level at $39.53, the July high. A breakout above this level would strengthen the bullish outlook and signal a continuation of the rising trend channel. However, there is potential resistance around the channel’s top, which has historically caused price stalls, such as in July when silver approached this boundary twice and faced short-term corrections. If the metal struggles to break through this level again, it could lead to another pullback.
The Channel Top as the Key to Silver’s Next Move
Silver is currently in a strong technical position: it has broken out above interim resistance, successfully retested support, and is consolidating near its recent highs. The next key signal will come from how silver reacts at the top of the channel and its trend high. A clean break above these levels would suggest accelerating momentum and open the door for further gains, possibly leading to new highs.
Alternatively, if silver faces rejection at the channel’s top, we could see a corrective retracement back toward the 50-Day moving average. Regardless of which scenario unfolds, silver remains bullish within its rising channel, supported by its key moving averages, and the overall outlook remains positive.
Conclusion:
Silver’s bullish trend remains firmly intact as it consolidates above key support levels. The next move will depend on how the price reacts to the resistance at $39.53 and the top of the rising channel. If silver manages to break through this resistance, it could trigger further upside momentum, possibly driving the price higher toward new targets. However, a failure to break through could result in a short-term pullback, though the overall trend remains bullish as long as silver stays above the 50-Day moving average. Traders should continue to monitor these key levels for potential entry points and further signals of momentum.
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