XAGUSD Hit the extreme top of the 2 year Channel Down.

Silver (XAGUSD) couldn't have gone better since our September 12 buy signal as following the Lower Lows Double Bottom, it not only broke above the 1D MA50 (blue trend-line) and 1D MA200 (orange trend-line), but also made a new Extreme High on the 1.382 Fibonacci extension.


As you see, we've charted Silver's pattern since February 01 2021, which is a Channel Down, most effectively viewed using the Fibonacci channel levels. This is basically the pattern we used to analyze the metal 3 months ago, and it helped us call accurately that bullish break-out.

So what now? With a slight modification to better adapt to the new Highs and Lows, we see that the rejection 3 days ago is so far as strong as the March 08 High during the Ukraine - Russia war. Now of course the fundamentals are not the same but technically as long as the price is below the 1.382 Channel Fib, we should see a 1D MA50/ MA200 test, at least on the short-term. If after that the price fails to regain the 1D MA50, we can even see a nose-dive back to the 0.382 Channel Fib.

Notice also how the RSI on the 1W time-frame just entered the Resistance Zone which since February 2021 was rejected and formed all major Lower Highs of this Channel Down.

In order for us to call for a bullish extension and invalidation of this long-term bearish trend, we ideally want to see XAGUSD not just closing above the 1.382 Channel Fib but above the 0.786 horizontal Fib, which failed to get tested during the March was High. In that case we will target initially the 26.900 March High on the short-term.


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