Article details
Silver prices (XAG/USD) dropped sharply on Thursday after buyers failed to push above the 50-day Simple Moving Average (SMA) at $78.73. The bearish-engulfing candlestick pattern formed at this level confirmed selling pressure, sending the price to $75.40, a 3% decline. Geopolitical tensions dominated market sentiment, but technical indicators suggest further downward momentum. The 50-day SMA is a critical resistance level, and its breakdown could trigger additional profit-taking by short-term traders. The next key support is at $72.50, where a decisive close below this level might accelerate the decline toward $70.00.
For traders, the bearish reversal at the 50-day SMA signals a potential shift in momentum. Silver's technical setup aligns with broader commodity weakness, as industrial demand remains subdued amid economic uncertainty. Short-term traders may focus on the $72.50 support as a key decision point, while long-term investors should monitor macroeconomic data for signs of a recovery. The recent geopolitical headlines have added volatility, but technical analysis suggests price action will remain range-bound until a clear breakout occurs.
The bearish-engulfing pattern is a strong technical signal that could influence both retail and institutional traders. If the $72.50 support fails, the risk of a deeper correction increases, potentially testing $68.00. Market participants should also watch for a possible rebound if the price stabilizes near $70.00, which could attract buyers looking for a bargain. The coming weeks will be critical in determining whether this is a temporary pullback or the start of a sustained downtrend.
