Silver Price Analysis: Break below key support is a bearish development - July 31, 2024

NEW YORK (July 31) Silver (XAG/USD) has broken below key lows in the $28.60s, reversed trend and extended its decline. 

The precious metal had been rising in what looked like a Measured Move (MM) pattern, with a C wave that extended substantially higher towards a target in the mid-$34s, however, after rallying up to a peak at $31.76, Silver capitulated and came tumbling down.

Silver Daily Chart

Silver’s break below key support at $28.67 was a significant turning point in terms of the trend and now means the commodity is probably in both a short and medium-term downtrend. Since “the trend is your friend” the odds favor a continuation of this downtrend lower. The MM that was forming seems to have completed with a stunted wave C. 

The next target lower is at $26.02 (May 2 low), with the 200-day Simple Moving Average (SMA) just a little below at $25.85 also likely to provide support. 

The Relative Strength Index (RSI) momentum indicator is not yet oversold suggesting Silver has more scope to fall.  

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