Silver Price Forecast: XAG/USD bulls need to wait for close above $32.00 mark

LONDON (October 7) Silver (XAG/USD) kicks off the new week on a weaker note and extends Friday's late pullback from the vicinity of the $33.00 mark, or its highest level since December 2012. The white metal remains depressed around the $32.00 round figure during the first half of the European session, though the mixed technical setup warrants some caution before placing aggressive bearish bets.

The recent repeated failures to find acceptance above the $32.00 mark constitute the formation of a bearish multiple-tops pattern on the daily chart. That said, oscillators on the daily chart are holding comfortably in positive territory and support prospects for the emergence of some dip-buying near the $31.65 area. This should limit the downside for the XAG/USD near the $31.40-$31.35 horizontal support. 

The subsequent fall has the potential to drag the commodity towards the $31.00 mark. Some follow-through selling below last week's low, around the $30.90-$30.85 area, could make the XAG/USD vulnerable to accelerate the slide further towards the $30.40-$30.35 intermediate support en route to the $30.00 psychological mark and the 50-day Simple Moving Average (SMA), around the $29.55 zone. 

Meanwhile, bulls need to wait for acceptance above the $32.00 mark and a sustained strength beyond the $32.25 supply zone before positioning for an extension of a two-month-old uptrend. The XAG/USD might then make a fresh attempt to conquer the $33.00 round figure before climbing further towards the December 2012 swing high, around the $33.85 region. 

FXStreet