• Silver extends its descent for the third successive day and drops to over a one-week low.
• The technical setup now favours bearish traders and supports prospects for a further fall.
• A convincing break below the trend-channel support will reaffirm the negative outlook.

Silver extends this week's retracement slide from the $24.50 horizontal resistance and edges lower for the third straight day on Thursday. The white metal remains on the defensive heading into the European session and is currently placed just below the mid-$23.00s, or the 200-period SMA on the 4-hour chart.

Bearish traders now await some follow-through selling below support marked by the lower boundary of over a one-month-old ascending channel before placing fresh bets. Technical indicators on the daily chart have just started gaining negative traction and support prospects for an eventual breakdown. That said, RSI (14) on hourly charts is on the verge of breaking into the oversold zone and warrants some caution.

A convincing break, however, might turn the XAG/USD vulnerable to weaken further below the $23.00 mark and accelerate the fall to the $22.60-$22.55 region. The downward trajectory could get extended further and drag spot prices to the next relevant support near the $22.10-$22.00 zone. The latter represents a static resistance breakpoint and might help limit losses, which if broken will be seen as a fresh trigger for bears.

On the flip side, any meaningful recovery attempt now seems to confront an immediate hurdle ahead of the $24.00 round-figure mark. This is followed by resistance near the $24.30 region and the multi-month peak, around the $24.50 area. A sustained strength beyond has the potential to lift the XAG/USD towards challenging the trend channel barrier, currently around the $24.80-$24.85 zone, en route to the $25.00 psychological mark.

Silver 4-hour chart

Key levels to watch