Silver (XAG/USD) experienced a slight dip on Monday, trading around $29.40, but has shown some recovery since its June 13th low of $28.66. Despite this recent bounce, the overall short-term trend remains bearish, suggesting further declines are likely.

Technical Outlook: Downward Momentum Persists

The current price action indicates that the recent recovery in silver prices is likely a temporary retracement within a broader downtrend. A break below the June 13th low of $28.66 would confirm this bearish bias and potentially open the door for further downside.

Key Support and Resistance Levels

• Immediate Support: The 50-day Simple Moving Average (SMA) at $29.01 could act as a potential support level in the near term.
• Downside Targets: If the downtrend resumes, a conservative target lies at $28.06, representing the 0.618 Fibonacci retracement level of the May range. A more significant decline could push silver towards $27.02, the full height of the May range extrapolated lower.
• Resistance: A decisive break above $30.50 would invalidate the short-term downtrend and signal a potential shift in momentum. A move above the $31.55 lower high could indicate a possible recovery towards the range high at $32.51.

Market Sentiment and Factors to Watch

The current bearish sentiment surrounding silver is driven by factors such as the strengthening US Dollar, expectations of higher interest rates, and reduced safe-haven demand. Investors should closely monitor these factors, as well as any potential changes in global economic conditions, for further clues on silver’s price trajectory.