Silver Price Analysis: XAG/USD climbs further beyond mid-$26.00s, over two-week tops

• Silver gained positive traction for the third consecutive session on Monday.
• Any subsequent move up might confront resistance near the 38.2% Fibo. level.
• Mixed technical indicators on the daily chart warrant caution for bullish traders.

Silver built the post-NFP gains and edged higher for the second consecutive session on Monday. This also marked the third day of a positive move in the previous four and pushed the white metal to over two-week tops, around the $26.60-65 region during the first half of the European session.

Given Friday's sustained move beyond the $26.30 heavy supply zone, or the 50% Fibonacci level of the $23.78-$28.75 move up, the momentum could be attributed to some technical buying. This might have also set the stage for an extension of the ongoing appreciating move amid a subdued USD demand.

Meanwhile, technical indicators on the daily chart – though have been recovering from the negative territory – are yet to confirm a bullish bias. Hence, any subsequent move up is more likely to confront stiff resistance and remain capped near the 38.2% Fibo. level, around the $26.85 region.

This is followed by the $27.00 mark, above which a fresh bout of the short-covering has the potential to lift the XAG/SUD further towards the 23.6% Fibo. level hurdle near mid-$27.00s.

On the flip side, the $26.30 resistance breakpoint (50% Fibo. level) now becomes immediate support to defend ahead of the $26.00 mark. A convincing break below will shift the near-term bias in favour of bearish traders and turn the XAG/USD vulnerable to break through the $25.70 confluence support.

The mentioned region comprises the very important 200-day SMA and the 61.8% Fibonacci level of the $23.78-$28.75 move up. Some follow-through selling below mid-$25.00s will reaffirm the bearish outlook and drag the XAG/USD back towards challenging the key $25.00 psychological mark.

Silver daily chart

Technical levels to watch