Silver Price Forecast: XAG/USD Bulls Show Hesitation Near $37.00; Downside Potential Limited

Silver remains near its peak levels, recording highs not seen in over two weeks as of Thursday.
Investors should exercise caution due to the mixed signals in technical indicators before making new market moves.
Dips in Silver prices may still attract buyers, suggesting underlying market support.

Silver (XAG/USD) is trading just shy of the $37.00 level during Friday’s Asian trading session, closely approaching its highest position in more than two weeks achieved yesterday. The overall technical perspective supports a bullish trend for the precious metal.

The daily Relative Strength Index (RSI, 14) is positioned above 50, reinforcing the optimistic outlook for XAG/USD. Nevertheless, the Moving Average Convergence Divergence (MACD) histogram and the signal line on the daily chart are not fully aligned with a bullish sentiment, indicating potential resistance around the $37.30-$37.35 area, which corresponds to the peak levels from early February 2012. Overcoming this could encourage further buying and extend the uptrend that has been active for nearly three months.

Conversely, the support zone at $36.50-$36.45 is expected to limit any immediate downward movement. Should prices fall below this level, XAG/USD could find itself targeting the $36.15-$36.10 range. A drop beneath the $36.00 threshold might lead to a test of the $35.50-$35.40 support area, a crucial juncture for Silver’s short-term trajectory. Breaching this level could tilt the market dynamics in favor of bears, potentially accelerating the decline towards the psychological $35.00 mark.

Further losses below this point could see Silver heading towards intermediate support around $34.75, before potentially reaching down to the $34.45 level.