Silver/EUR: Buyers Pursue Weekly High Amid Strengthening Momentum
Market Overview
On Tuesday, December 3rd, 2024, the Silver/Euro (XAG/EUR) pair continued its bullish trajectory, reflecting intensified positive sentiment among market participants. A weakened euro, pressured by a strengthening U.S. dollar, has bolstered demand for silver across European markets, fostering a rebound from mid-October lows. Currently, silver is experiencing its fourth consecutive session of gains, with the key weekly high of 32.231 EUR looming as an attainable target, contingent on continued momentum. In a broader macroeconomic context, evolving central bank policies, heightened industrial demand for silver, and persistent political uncertainties within the Eurozone remain significant supportive factors for the metal’s ascent.
Technical Analysis
In the daily chart, Silver/Euro has exhibited considerable bullish strength, evidenced by buyers achieving the largest daily gains recorded over the past week. The price action has decisively breached the 23.6% Fibonacci retracement level at 29.028 EUR, marking a significant technical breakthrough. The next immediate target lies at the resistance level of 29.640 EUR. A confirmed breakout above this resistance is critical, as it would pave the way for an advance towards subsequent targets at 30.135 EUR and 30.630 EUR, where the next key resistance levels are situated.
The technical outlook remains positive, with momentum indicators aligning with the prevailing bullish sentiment. The Relative Strength Index (RSI) comfortably signals upward momentum, though nearing potential overbought conditions, warranting caution. Meanwhile, the Moving Average Convergence Divergence (MACD) indicator remains in mixed territory but with a discernible bullish bias, suggesting a gradual increase in positive momentum. Moving averages, particularly the convergence of the 50-day and 100-day moving averages, also indicate a reinforcing uptrend, adding further credence to the ongoing rally.
Nevertheless, should the price fail to overcome the resistance at 29.640 EUR, a period of consolidation may ensue, with initial support anticipated at 29.280 EUR. A failure to maintain this support level could expose the pair to a deeper correction, potentially testing the lower support at 28.039 EUR. Sellers may target this crucial support area should momentum shift against the current uptrend, potentially signaling a broader reversal.
Key Levels
- Resistance Levels: 29.640, 30.135, 30.630, 31.334, 32.231
- Support Levels: 29.280, 28.039
Key Events to Watch
Looking forward to Wednesday’s trading session, significant Eurozone economic data are expected, including PMI releases and a speech by European Central Bank (ECB) President Christine Lagarde. The outcomes of these events will be pivotal for the euro’s direction, potentially affecting the Silver/Euro pair. Any dovish rhetoric from Lagarde, coupled with weaker-than-expected PMI figures, could serve as an additional catalyst for silver bulls, facilitating a breakout above the current resistance levels.
Conclusion
The Silver/Euro pair retains a bullish outlook as it continues to recover, with immediate resistance at 29.640 EUR remaining a key determinant for short-term sentiment. A decisive break above this resistance could propel the price towards 30.135 EUR and beyond, while failure may lead to a consolidation phase or a corrective move towards lower support levels.
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