Silver Price Forecast: Poised for Bullish Reversal from Key Support

Silver is set to complete a bullish reversal day on Monday. A bullish signal was indicated earlier in the session as silver rallied above Friday’s high of 28.08. Subsequently, sellers took back control and drove the price to a new retracement low of 27.31 before there were signs of support leading to a bounce. At the time of this writing, it looks likely to close relatively strong, in the top half of the day’s trading range. It may also set up a bullish hammer candlestick pattern. The low traded price for the day successfully tested the 50% retracement zone as support.

Bullish Reversal Above 28.20

Heading into Tuesday’s session, a bullish reversal will be triggered on a decisive rally above today’s high of 28.20. Notice that support was found the past few days around the top downtrend line. It previously represented resistance and now support.

Each of the past few days closed at or above the line, even though intraday silver fell below the line. Also, notice that support has been seen around the completion of a falling ABCD pattern (D) and along with the trendline the past few days closed at or above the 27.81 target for the pattern. This is further technical evidence for a potential bounce.

A rally above today’s high would open the door for an advance to test potential resistance at higher prices. The first target would be around 28.57, which was the prior swing low support until it was busted Thursday during a sharp selloff. Higher up is last week’s high of 29.45. The 50-Day and 20-Day MAs are at 29.92 and 30.02, respectively.

Lower Price Levels Start with 26.74

On the downside, silver is at risk of reaching lower support levels if today’s low of 27.31 fails to remain support. A 127.2% extension for the falling ABCD pattern completes at 26.74. Further down is a support zone identified by several indicators. It starts with a 26.14 swing high from May 2023 and ends at the 200-Day MA at 25.89. Moreover, also included within target range is a 25.91 swing high from December 2023 and a swing low of 26.02 from May. The 61.8% Fibonacci retracement completes at 25.98.

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