Silver Price Analysis: XAG/USD clings to modest recovery gains, not out of the woods yet

• Silver edged higher on Wednesday and recovered a part of the overnight losses.
• The near-term technical bias remains tilted firmly in favour of bearish traders.
• Any subsequent move up is more likely to remain capped near the $25.00 mark.

Silver traded with a mild positive bias through the first half of the European session and was last seen hovering near daily tops, around the $24.80-85 region. The uptick assisted the commodity to recover a part of the previous day's losses to near four-month lows.

From a technical perspective, the overnight slide confirmed a near-term bearish breakdown through a three-day-old trading range. Subsequent weakness below the previous monthly swing lows, around the $24.75 region, supports prospects for an extension of the recent leg down.

However, overstretched RSI (14) on the 1-hour chart prompted some short-covering move on Wednesday. That said, technical indicators on 4-hour/daily charts are still far from being in the oversold territory and add credence to the near-term bearish outlook for the XAG/USD.

Hence, any subsequent positive move might still be seen as a selling opportunity near the trading range support breakpoint, around the key $25.00 psychological mark. This, in turn, should keep a lid on any meaningful upside for the XAG/USD near the $25.40 heavy supply zone.

On the flip side, the overnight swing lows, around mid-$24.00s might act as immediate support. Some follow-through selling should turn the XAG/USD vulnerable to accelerate the downfall further towards the $24.00 round-figure mark en-route YTD lows, around the $23.80-75 region.

Silver 1-hour chart

Technical levels to watch