XAGUSD Critical Resistance test. Trade the break-outs.

Silver (XAGUSD) gave a solid rejection at the top of the long-term Channel Down (see chart below) when we looked into it on July 21 2023:


This rejection gave way to the creation of the current Bearish Megaphone pattern whose low got priced on October 04. This initiated the current bullish leg which tested the 1D MA200 (orange trend-line) and almost reached Resistance 1 (23.775). As long as this holds, the selling pressure will pile up to see if the 1D MA50 (blue trend-line) will hold.

If it closes a 1D candle below it, we will sell and target 22.350 (top of Support 1 and above the 0.5 Fibonacci level). If on the other hand we close above Resistance 1 (23.775), we will buy and target the top (Lower Highs trend-line) of the Bearish Megaphone at 24.300.

Note that the 1D RSI is testing its own Lower Highs trend-line. As long as it remains below it, the selling pressure will keep piling up.

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