Technical outlook:
Silver slipped close to $21.50 after hitting up to $21.95 over the last week. The metal is expected to find intraday support at around the $21.30-40 zone before it could resume its rally towards the $24.00-20 area. Bulls will be inclined to hold prices above $20.90 and broadly above $20.45 to keep the structure constructive.
Silver is still working on the last leg rally within the corrective phase that had begun since the $20.45 lows earlier. The first and second waves of the corrective rally terminated at around $22.44 and $20.90 respectively. If the above structure holds well, the metal should produce a sharp rally towards $24.00 as the third wave progresses.
Silver has been in a downtrend since the $30.08 highs printed in February 2021. The metal has carved a recent larger degree downswing between $26.22 and $20.45 as seen on the daily chart. Also, note that the $24.00-20 zone is passing close to the Fibonacci 0.618 retracement of the above downswing. Hence, a high probability remains for a turn lower if prices manage to reach there.
Trading plan:
Potential rally through $24.00 against $20.00
Good luck!
