- Silver continues to gain momentum on Monday, reaching a new 12-year high.
- A slightly overbought RSI on the daily chart suggests caution for bullish traders.
- Any significant pullback is likely to attract buying interest and remain constrained.
Silver (XAG/USD) surged to its highest level since October 2012 during the first half of the European session on Monday, with bulls aiming to push past the $34.00 round-figure mark.
In a broader context, Friday's sustained breakout above the $32.50 supply zone served as a fresh catalyst for bullish traders. However, the Relative Strength Index (RSI) on the daily chart has crossed above 70, indicating slightly overbought conditions. This suggests it may be wise to wait for some near-term consolidation or a modest pullback before entering further long positions.
Meanwhile, any significant decline is likely to be viewed as a buying opportunity and should find support near the $33.00 level. A convincing drop below this could trigger technical selling and pull XAG/USD back toward the $32.50 resistance level, now acting as support, en route to the key $32.00 mark. If this level is broken, it could shift sentiment in favor of bearish traders.
On the upside, immediate resistance is seen near the $33.45 horizontal zone. A breakout above this could enable XAG/USD to target the psychological $35.00 mark. The momentum may extend toward the October 2012 swing high, in the $35.35-$35.40 range, although bullish traders should proceed with caution given the current technical setup.
Sliver Daily Chart
