What Happened
Silver (XAG/USD) surged to two-month highs just above $87.00 before sellers stepped in hard, driving the price down to $84.80 — a retreat of roughly $2.20 or approximately 2.5% from the session peak. The sharp reversal during early European trade signals that bulls ran out of steam at a technically significant resistance zone, triggering profit-taking and fresh short positions.
Key Levels
- Support 1: $84.00 — round-number psychological floor and recent consolidation base
- Support 2: $82.50 — prior breakout level that acted as resistance in recent weeks
- Resistance 1: $85.50 — short-term intraday ceiling following the reversal
- Resistance 2: $87.00–$87.20 — two-month high rejection zone; bulls need a clear close above here to resume the uptrend
Technical Picture
The sharp rejection at $87.00 has created a potential bearish wick or shooting star pattern on the daily chart — a warning sign for bulls. Price has pulled back below the $85.00 level, which now flips to short-term resistance. The broader trend remains cautiously bullish given the two-month high reached today, but momentum has clearly stalled. Traders should watch the RSI — if it dips back below 50, that would confirm sellers are regaining control.
What Traders Are Watching
- A close back above $85.50 would suggest the dip is being bought and the uptrend could resume toward $87.00
- A break below $84.00 would open the door for a deeper pullback toward the $82.50 support zone
- Gold (XAU/USD) direction — Silver often follows gold closely, so any weakness in gold could add further downside pressure on silver
Bias
Bearish short-term. The rejection at two-month highs above $87.00 is a classic bull trap signal. Until silver can reclaim $85.50 on a closing basis, the path of least resistance is lower toward the $84.00–$82.50 support zone.