Silver prices have fallen below the $50 threshold, marking a sharp reversal from the record peak of $54.40 reached on 17 October, according to the XAG/USD chart.
The correction has been accompanied by a classic bearish ABCD formation, with the market sliding beneath the key psychological barrier at $50. The weakness has mirrored movements in gold, which has fallen this week from around $4,375 to just above $4,000 per ounce.
Analysts note that the recent downturn is largely corrective within an otherwise strong bullish cycle, supported by a still-solid fundamental backdrop. Nevertheless, the speed and intensity of the sell-off raise questions about the durability of the recent metals rally.
The sell-off appears to reflect two main forces:
→ An overheated speculative surge, fuelled by excessive leveraged long positions;
→ A decisive shift in sentiment, with bears exploiting technical weaknesses to force liquidations.
Technical View: XAG/USD
Chart analysis of XAG/USD reveals key inflection points forming an expanded ascending channel, which has widened after this week’s decline. The move has effectively turned the former lower boundary into the new median line, indicating an adjustment in momentum structure.
From a bullish standpoint:
→ The lower boundary of the expanded channel is now acting as robust support.
→ The RSI indicator shows an emerging bullish divergence.
→ Recent price action around point D hints at a potential Triple Bottom reversal.
From a bearish perspective:
→ Sellers remain in control after breaking below:
$52.60, a key level that has flipped to resistance;
The psychological $50 threshold.
Considering these factors, it is plausible that buyers could attempt to stabilise prices along the lower boundary of the channel, aiming to revive the broader uptrend. However, given the magnitude of recent declines, market sentiment may remain fragile. If $50 continues to act as resistance, bears may target the next major support near $45.88.
FXOpen offers spreads from 0.0 pips and commissions from $1.50 per lot. Enjoy trading on MT4, MT5, TickTrader or TradingView trading platforms!
The FXOpen App is a dedicated mobile application designed to give traders full control of their accounts anytime, anywhere.
This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.
Disclaimer: This sponsored market analysis is provided for informational purposes only. We have not independently verified its content and do not bear any responsibility for any information or description of services that it may contain. Information contained in this post is not advice nor a recommendation and thus should not be treated as such. We strongly recommend that you seek independent financial advice from a qualified and regulated professional, before participating or investing in any financial activities or services. Please also read and review our full disclaimer.
