Key Takeaways
- Silver corrects back more deeply than expected
- RSI is diverging bearishly suggesting underlying weakness
- Break above $30.19 confirms bull trend continuation
- Break below $28.79 indicates short-term trend reversal
Silver Corrects Back after Hitting Higher Highs
Silver (XAG/USD) has corrected back after reaching a high of $30.19 on August 26. The correction has led to a break below key support at $29.23 (August 2 high), questioning the dominant uptrend in the market.
Technical Analysis
A break above the August high at $30.19 would confirm more upside and signal the continuation of the bullish trend, with a target at $30.61 being the next key level. On the other hand, a break below the August 22 low at $28.79 could signal a reversal in the short-term uptrend.
Relative Strength Index (RSI)
The Relative Strength Index (RSI) is diverging bearishly with price, indicating potential underlying weakness in the market. Although the price did not make a lower low on August 28, the RSI did, suggesting a lack of strength in the current trend.
Medium to Long-Term Outlook
The trend on the medium and longer-term charts is unclear, possibly indicating a sideways movement with little directional bias from higher time frames. This suggests that further price action may be required to determine the overall trend direction.